/ BLOG

Does a sole proprietor need Professional Liability Insurance?

Aug 11, 2021 · 5 minutes to read

A business person in the office sitting in a chair.

There are many benefits to working as a sole proprietor. Establishing your business is often simple, as there’s just one person you need to worry about (yourself!). You also have the flexibility of being your own boss and the advantage of getting to keep all the profits.

This is not to say that running a business as a sole proprietor is easy. You still face many of the challenges that other small businesses do, but without help from anyone else. Everything is on you, and if something goes wrong it’s your responsibility alone to fix the problem.

So what happens when a client is unhappy with the work you’ve done for them? If a mistake you’ve made or a deadline you missed has caused them to lose money, they may decide to seek compensation through a lawsuit.

This is where sole proprietors, who offer professional services or advice may need support from Professional Liability insurance to help protect their livelihood and professional reputation.

What is Professional Liability insurance?

Professional Liability, also known as Errors and Omissions (E&O) insurance, protects your business against claims of negligence, misrepresentations, or mistakes. Professional Liability claims are typically made by clients who allege some form of financial damage as a result of your services, products or employees.

This form of coverage helps protect sole proprietors and other small businesses against claims of:

  • Error or mistake
  • Omission
  • Negligence
  • Breach of contract
  • Undelivered services
  • Missed deadlines

These types of claims are common across a variety of industries and occupations, from architects to yoga instructors.

How Professional Liability insurance can protect sole proprietors

Small businesses of all sizes purchase Professional Liability insurance to protect business. However, sole proprietors may especially benefit from the protection that a policy can provide.

When you work alone, as sole proprietors do, the responsibility for all parts of the business fall on your shoulders. This sometimes means that business liabilities become personal liabilities. Lawsuits targeting your professional reputation call you out by name and legal expenses can quickly diminish your savings (both business and personal).

Professional Liability insurance can help remove some of these burdens. A policy helps you defend yourself in court by paying attorney’s fees, court costs, settlements, and judgements. This creates a safety net for your financial accounts, helping you stay in business and protecting your personal savings. This protection also extends to meritless claims, which can be just as costly to defend against.

What types of sole proprietors might need this insurance?

Professional Liability insurance is typically purchased by individuals and small businesses who provide professional services to clients or customers. This typically includes common white-collar occupations like accountants, lawyers, engineers, and consultants.

However, there is a wide range of professionals who might need Professional Liability insurance. People like personal trainers, home health care workers, and even event planners may also consider having a policy.

If you’re unsure if Professional Liability insurance is right for you, it may help to think about the type of work you do. If it involves any of the following, you might want to consider a Professional Liability policy:

  • You offer clients or customers specialized services.
  • You give your clients or customers advice that they rely on the make decisions
  • You represent your clients’ or customers’ needs on their behalf

Is Professional Liability insurance ever required by law?

In some instances, sole proprietors may be required by law to have a Professional Liability policy.

Some states require sole proprietors and other small business owners in certain professions to have Professional Liability insurance before they can work in the state. Additionally, some professional associations require their members to have minimum levels of coverage to become licensed or otherwise practice their profession.

Is Professional Liability the only protection that sole proprietors may need?

Depending on your occupation, there may be other risks sole proprietors face that Professional Liability insurance does not cover. Other common forms of insurance that you consider include:

  • General Liability – Protects you against any claim by an outside party regarding injury or damage to their property. In these instances, your policy will cover your legal expenses as well as your cost to replace or remedy the situation.
  • Business Owner’s Policy – A convenient and affordable way for small business owners to protect against several of their most common exposures. These policies combine General Liability insurance with other types of coverage, such as business interruption and business property damage.

Find Professional Liability insurance for sole proprietors

Professional Liability insurance can help sole proprietors protect their business, so they can focus on running it instead. With that in mind, BizInsure has made it simple for sole proprietors and small business owners of all types to find the coverage they need.

We’ve removed the hassle from buying business insurance, by using technology to simplify the process and offer competitive pricing from top-tier insurers. You could have a Professional Liability policy in 10 minutes (maybe even less!) to help protect your growing business.

Let's find

The coverage you need for your business

Professional Liability Insurance

Professional Liability Insurance

Get a quote

General Liability Insurance

General Liability Insurance

Get a quote

Business Owner’s Policy (BOP)

Business Owner’s Policy (BOP)

Get a quote

Workers Compensation Insurance

Workers Compensation Insurance

Get a quote

Let's find

The coverage you need for your business

Professional Liability Insurance

Professional Liability Insurance

Get a quote

General Liability Insurance

General Liability Insurance

Get a quote

Business Owner’s Policy (BOP)

Business Owner’s Policy (BOP)

Get a quote

Workers Compensation Insurance

Workers Compensation Insurance

Get a quote

Awesome service!
Very easy to work with, cost effective, prompt renewal and easy to get certificates of insurance instantly. I use them exclusively for my professional and general liability insurance needs as a consultant. They simply make my insurance be easy!
VERY PROFESSIONAL STAFF. CALLS ARE RETURNED PROMPTLY!!
Huge thank you to Andrea, she was patient, kind, & caring! Got my quote fast & at best price!
Excellent and Easy service - Thank you.
Amy was a delight to work with she help me with finding he right policy for my business I can't thank her enough for her help
I purchased liability insurance for my home care agency, Unlimited Gentle Care, and the process was seamless and straightforward, ensuring that every aspect of our liability was covered. This company also offers a great value for the extensive coverage my company receives
BizInsure was an easy way to purchase insurance for my business.Kaleb especially was a great help.Thanks,Rich Valentini
awsom service, perfect price and great policy
I have purchased General Liability Insurance for the past 4 years at BizInsure for my wedding videography small business. In these 4 years, it has always been a smooth process.There must've been some sort of technical issue (potentially due to my change in address), so my policy didn't auto-renew. I called Bizinsure and talked to Paulina, who was beyond helpful. She was very polite and explained things very well. One small detail that I can appreciate is that she often said my name, which shows that their customer service is intentional about personalized communication.In just a few minutes, we updated my account + renewed my insurance for a 5th year. I highly recommend Bizinsure!
great customer services.
This company allowed us an amazing experience, including very efficient, detail-oriented, and patient guidance from their commercial sales agent, Jenifer. I highly recommend this service for anyone in need of a business insurance policy.
Jennifer was very helpful and great to work with.
Very professional, fast and reliable. I appreciate their knowledge and experience. They have made this journey easier for me.
Very easy to renew! Thank you
super quick and easy process!
I am very satisfied with Bizinsure. No regrets
Very professional, easy, and thorough application process.
BizInsure is efficient and price friendly. I definitely reccommend them to anyone. Thank you.
Great process and very efficient.
Friendly and very fast service!
Jennifer Whiscombe, is an amazing agent. She was very knowledgeable, thorough and friendly. I highly recommend.
They make it very easy to buy insurance and renew.
As a business owner I love not wasting time. Thank you so much for giving me more time
Very straight forward, the cost of coverage amount made sense, simplicity was appreciated.
Always easy. Thank you.
A Company that is easy to deal with and that I have used for several years. I appreciate the continued support.
Very easy and affordable!
Responsive and professionalCompetitive price. I highly recommend Bizlnsure as an insurance provider
Your service is easy to renew as needed and your company informs the client in advance for renewal.
It has been a pleasure doing business with Biz Insure Llc.Their representatives are very courteous, helpful and customer service oriented.
Quick and easy....
I follow the instructions & would prefer to paid every month. I did not have the options to pay every month.
Thank you, Amy, for making my experience enjoyable and funny. Thank you so much for your kindness!!!
I'm pleased with the business quote I received from Bizinsure LLC. Thank You!
Very satisfied with the online experience
Been a happy customer for years! Easiest company to receive a quote and get insured. No hassles! Easy payment! Finance plans, if needed!
js_loader
Google Rating
4.7
Based on 290 reviews
×
js_loader