Professional Liability Insurance: What It Covers, How to Get It

Businesses that provide services for a fee should have professional liability insurance.
Nov 19, 2021

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Professional liability insurance is business insurance that protects you if a client files a lawsuit over an alleged or actual mistake or bad piece of advice. Types of professional liability insurance include errors and omissions insurance and medical malpractice insurance.

In general, anyone who provides a service to clients should have professional liability insurance. Many professionals are required to carry it.

What's the best fit for your business?
Answer a few questions and we'll match you with an insurance partner who can help you secure quotes.

What does professional liability insurance cover?

Professional liability insurance can protect businesses against the following kinds of claims, including covering legal and settlement costs:

  • Professional negligence or failure to meet a standard of care.

  • Breach of contract.

  • Failure to deliver a promised service on time.

Unlike some other types of liability insurance, professional liability policies generally protect against claims of financial losses, not bodily injury or property damage. Medical malpractice insurance is an exception to that rule, though, as are policies for architects and engineers.

What isn’t covered by professional liability insurance?

Professional liability doesn't protect a business against:

  • Bodily injury or property damage that customers or clients suffer while you’re doing business — for instance, if they trip and fall in your office or if their personal files are destroyed in a fire. Those are general liability insurance claims.

  • Lawsuits filed by employees with allegations like wrongful termination or workplace harassment. For those, a business will need employment practices liability insurance.

Who needs professional liability insurance?

Anyone who provides professional services or advice to clients for a fee faces the risks that professional liability insurance protects against. This list can include:

  • Accountants.

  • Architects.

  • Consultants, including management and IT consultants.

  • Engineers.

  • Financial or investment advisors.

  • Insurance and real estate agents and brokers.

  • Software developers and graphic designers.

Medical professionals may be required by law to carry medical malpractice insurance. This kind of professional liability insurance specifically protects physicians, dentists, psychologists and other medical professionals against claims that they made a mistake that led to a patient’s injury or death.

Professional liability insurance may be required in other fields as well. For example, state licensing bodies may require lawyers to carry legal malpractice insurance or to tell clients whether or not they have it.

How much is professional liability insurance?

  • How common lawsuits are in your industry.

  • The location where you work and how common claims are there.

  • How much coverage you need.

  • How many employees you have.

  • How long you’ve been in business.

  • What kind of claims, if any, you’ve filed in the past.

Insurance marketplace Insureon says its customers pay a median of $59 per month for professional liability insurance. In 2020, customers paid an average of $46 per month for professional liability insurance through Progressive's Advantage Business Program.

How to find the best professional liability insurance

If you already have business insurance, ask your insurer if you can add professional liability coverage. You may save money by bundling policies.

If you don’t have coverage yet, consider the following companies that offer professional liability insurance:


Who's a good fit

NerdWallet's review

State Farm

If you prefer to work with an insurance agent and want to add professional liability coverage to a business owner’s policy.


If you do work for clients outside the U.S.

The Hartford

If you expect your insurance needs to expand in the future and want to work with a company that provides many types of coverage.


If you need a policy quickly and want to buy it online.

All major commercial insurance companies offer professional liability insurance — but some sell policies that they don’t underwrite themselves. For example, Geico and Progressive’s professional liability insurance policies come from third parties. It may make sense to work directly with those partner issuers if you’re not getting a discount for combining coverage.

NerdWallet also recommends comparing quotes from multiple insurers to find the lowest rates and best coverage.

What's the best fit for your business?
Answer a few questions and we'll match you with an insurance partner who can help you secure quotes.