Professional liability insurance
General liability and professional liability insurance both protect against common small business liabilities, but cover two different types of lawsuits. You may need to purchase one or both policies depending on your risks.
Client contracts often require professional liability insurance. Businesses in certain industries are also required to have this coverage.
While disputes with clients over negligent, unfinished, or inadequate work make up the bulk of cases, professional liability lawsuits can also encompass similar disputes with business partners.
When a dissatisfied client sues over a mistake made by your business, professional liability insurance can cover your legal expenses, including the cost of hiring a lawyer.