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Why do I need professional liability insurance?
Insurance is something we know you'd rather not think about. But you need to be aware of your exposures that go beyond the coverage provided by your commercial general liability (CGL) policy.
Your CGL policy is designed to cover bodily injury and property damages. But if your responsibility goes beyond construction to design delegation, project design or construction management, you need professional liability coverage, too.
You may not be worried about design flaws. But when you assume a single point of responsibility role for a project, you contractually provide project design services, whether design is provided by your in-house design team, subcontracted to a design firm, or provided through a joint venture. Even in traditional project delivery methods, you may have design responsibility through design delegation, preparing shop drawings or design exposures associated with the means and methods of construction.
Want to know for sure? Quiz yourself with our Contractor's Check List, designed to help you identify sources of risk in your practice that could be covered by professional liability insurance.
Professional liability coverage allows you to transfer this risk to an insurance company. You pay a premium so that, if a lawsuit is brought against you, the insurance company will not only pay out damage awards on a covered claim, but also pay your defense costs.
For more on this topic, try the following articles:
If you'd like to discuss your specific risks, you might want to talk to an independent agent or broker in your area.
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