Professional Liability & E&O Insurance in Texas
Your clients trust you for your knowledge, advice and expertise. Professional liability insurance can help protect your business against certain claims arising from professional services, errors or omissions.
- ✓ Independent agency
- ✓ Multiple E&O carriers
- ✓ Serving professionals across Texas
When Your Expertise Is Your Business, Your Advice Carries Risk
Consultants, designers, engineers, accountants, technology professionals and other service businesses are paid for what they know. Clients rely on that expertise to make decisions, complete projects and move their own businesses forward.
Even experienced professionals can face a claim alleging that a mistake, omission, inaccurate advice or failure to perform a service caused a client financial harm.
Professional liability insurance, also known as errors and omissions or E&O insurance, is designed to address certain claims arising from professional services. The Texas Department of Insurance describes it as coverage for claims for damages arising from the performance of professional services.
What Professional Liability Insurance May Help With
Coverage depends on your profession, policy definitions, exclusions and limits. Common areas include:
Professional Errors
A client may claim that an error in your professional work caused them a financial loss. Depending on the policy, certain covered claims may be addressed.
Errors & Omissions
A missed detail, omission or failure to provide an agreed service can result in a claim. E&O coverage is designed around these professional-service exposures.
Client Financial Loss
Claims often allege that a client’s financial interests were harmed because of your services, advice or work.
Legal Defense
Depending on the policy, coverage may include certain defense costs for covered claims, which can be significant even when a claim lacks merit.
Negligence Claims
Certain policies can respond to covered allegations of negligence arising from professional services.
Contract Requirements
Some clients and contracts require you to carry professional liability insurance and provide proof of coverage.
Professional Liability vs. General Liability
These policies address different exposures. Having one does not mean you have the other.
| Coverage | Generally Designed to Address | Example |
|---|---|---|
| General Liability | Certain third-party claims involving bodily injury, property damage and personal or advertising injury. | A client trips and falls in your office. |
| Professional Liability / E&O | Certain claims arising from professional services, errors, omissions or professional negligence. | A client says your advice cost them money. |
Who May Need Professional Liability Insurance?
If clients pay you for advice, expertise or a specialized service, you likely have professional liability exposure.
Consultants
Management, business, operations and specialized consultants may face claims related to the advice they provide.
IT Professionals
IT consultants, technology providers and software professionals may have professional-service exposures in addition to cyber risks.
Engineers & Designers
Design decisions, calculations, specifications and recommendations can create specialized liability exposures.
Accountants & Bookkeepers
Clients depend on accurate financial work, filings and advice.
Real Estate Professionals
Agents, brokers and inspectors may face claims involving professional services, representations or alleged errors.
Skilled Trades & Care Providers
Electricians, HVAC professionals, childcare providers and other licensed services can have professional exposures too.
According to the Texas Department of Insurance, some professions must carry professional liability insurance to get a license, including home day care centers, HVAC installers, plumbers and real estate inspectors. Clients and contracts may also require proof of coverage.
Pay Attention to Claims-Made Coverage
Many professional liability policies are written on a claims-made basis. Claims-made policies generally cover incidents that occur during the policy period and are reported to the insurer during that period, unless special coverage is arranged. That makes these provisions especially important when you buy, renew or switch policies.
Retroactive Date
The earliest date of work the policy will consider. Keeping continuous coverage helps preserve protection for past work.
Reporting Requirements
Claims, and sometimes potential claims, must be reported within the policy’s timeframe to be considered.
Extended Reporting (Tail)
If you retire, close or change carriers, an extended reporting period may allow claims to be reported after the policy ends.
Examples of Professional Liability Exposures
These examples are illustrative only and do not indicate that a particular claim would be covered.
Missed Deadline
A client alleges that a missed professional deadline caused a financial loss and seeks compensation.
Professional Recommendation
A client claims that your recommendation or advice resulted in an unexpected financial loss.
Design or Specification Error
A client alleges that an error in plans, specifications or designs caused additional expenses.
Failure to Deliver a Service
A customer alleges that a professional service was incomplete, inaccurate or not performed as promised.
Professional Liability Coverage With a Personal Approach
An IT consultant, engineer, accountant and management consultant can have very different professional exposures. We take the time to understand what your business actually does and how you serve your clients.
Understand Your Business
We start with your services, clients, contracts and professional exposures.
Compare Options
As an independent agency, we explore available options from multiple carriers.
Explain the Details
We walk you through limits, deductibles, retroactive dates, exclusions and other key provisions.
Professional Liability & E&O Insurance FAQs
What is professional liability insurance?
Professional liability insurance is coverage designed to address certain claims arising from professional services. It is also commonly called errors and omissions or E&O insurance.
What is E&O insurance?
E&O stands for errors and omissions. E&O insurance is another common name for professional liability coverage designed around professional-service exposures.
Does general liability cover professional errors?
Not necessarily. General liability and professional liability cover different kinds of damage, so you may need both. Review your policies, or talk with your agent, to understand what is and isn’t covered.
Is professional liability insurance required in Texas?
It depends on the profession. Some Texas professions, such as home day care centers, HVAC installers, plumbers and real estate inspectors, must carry it to get a license. Clients or contracts may also require proof of coverage.
Are professional liability policies claims-made?
Many are. Claims-made coverage makes the policy period, reporting requirements, retroactive date and extended reporting options important considerations. Always review the specific policy provisions.
How much professional liability insurance does my business need?
The appropriate limits depend on your profession, contracts, client requirements, business size, services and potential exposure. An insurance professional can help evaluate the limits available for your situation.
Professional Liability Is One Part of Your Insurance Plan
Depending on what your company does, you may also need coverage for general liability, cyber risks, employees and other exposures.
General Liability
Coverage for certain third-party bodily injury and property damage claims.
Learn more →Cyber Insurance
Coverage designed around certain cyber, data and technology-related risks.
Learn more →Business Owner’s Policy
A package that combines certain property and liability coverages for qualifying businesses.
Learn more →Employment Practices Liability
Coverage options for certain employee claims such as wrongful termination or discrimination.
Learn more →Commercial Umbrella
Extra liability limits above your underlying business policies.
Learn more →Commercial Crime
Coverage options for employee theft, forgery and certain funds transfer fraud.
Learn more →Your Expertise Is Valuable. Let’s Protect the Business Behind It.
If your business provides professional advice, expertise or services, let’s talk about professional liability and E&O options that may fit.
Insurance coverage is subject to policy terms, conditions, limits, exclusions, definitions and endorsements. Professional liability coverage varies by profession, insurance carrier and policy. Claims-made policies may also contain specific reporting requirements and retroactive-date provisions. This page is for general informational purposes and is not a contract or guarantee of coverage. Please review your policy and speak with your insurance agent about your specific business and coverage needs.