What is the primary purpose of a Professional Liability Policy?

The primary purpose of a Professional Liability Policy is to protect against claims of negligence or malpractice. This type of insurance is specifically designed for professionals who provide services or advice, such as doctors, lawyers, consultants, and accountants. It safeguards these individuals and organizations from legal claims arising from errors, omissions, or breaches of duty in the performance of their professional services.

In many professions, the risk of being sued for negligent acts or failure to deliver services as expected is significant. A Professional Liability Policy helps cover the legal costs and any settlements or judgments that may arise from such claims. This is crucial for professionals, as reputational damage and financial liability can be substantial if these matters are not adequately addressed.

The other options focus on different areas of risk. Coverage for damages from accidents involving company vehicles is typically provided by commercial auto insurance. General liability coverage addresses a broader range of risks, including bodily injury and property damage to third parties but does not specifically cover professional malpractice or negligence claims. Property insurance relates to physical assets owned by the business rather than services rendered, so it does not serve the same purpose as Professional Liability coverage.