Tuesday, September 23, 2014
When it comes to insurance,
businesses have a lot more to worry about than just health insurance.
Professional liability insurance, for instance, aims to protect
people (and businesses) from costly lawsuits relating to the
performance of their professional responsibilities. Common examples
of these are malpractice insurance for doctors and lawyers.
Cases
Malpractice or negligence is
just one aspect of the liabilities insurance. Customers or clients
could file a lawsuit against companies for a variety of reasons, such
as failure to deliver a promised product or service, production and
distribution of inferior or damaged merchandise, errors in judgment
calls, and many others.
Every Lawsuit Counts
Many professionals believe
that since malpractice lawsuits essentially have low probabilities of
succeeding, they can do away with professional liability insurance.
However, the fact is, the moment your business is summoned to appear
in court, the costs are already flowing out of your pocket, something
that could take a huge toll on your revenues.
Claims-Based
Know that most liability
insurance offered by firms involve claims-based coverage. This means
that only lawsuits made and reported during the period of your policy
will be reviewed. If there are previous claims that you want covered,
look for a retroactivity coverage. If you’re retired but you’re
still concerned about lawsuits made relating to your previous
services, look for extended coverage.
