What does claims-made mean?

A claims-made policy responds to claims first made while the policy is active, for work done after its retroactive date. Keeping coverage continuous and the retroactive date unchanged matters when switching policies.

Do contractors need professional liability?

Contractors who provide design, engineering, or project-management services, or whose contracts require it, often carry it. Pure installation work is usually addressed by general liability instead.

Coverage guide

Professional liability insurance (errors and omissions)

Professional liability, also called errors and omissions (E&O), covers claims that a mistake, oversight, or failure to deliver a professional service cost a client money. General liability is built for injuries and property damage, not for financial loss from your work, so service businesses often need both.

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What professional liability commonly covers

Who usually carries it

Consultants, designers, engineers, and other advice-based businesses
Design-build contractors and businesses that provide plans or specifications
Technology, accounting, real estate, and marketing firms
Businesses whose client contracts require it

Commonly covered

Claims of negligence, errors, or omissions in your professional services
Claims that you failed to deliver what you promised
Legal defense costs, which some policies include within the limit

Commonly excluded or limited

Bodily injury and property damage (general liability)
Intentional or fraudulent acts
Claims made after the policy ends, unless an extended reporting period applies
Work performed before the policy's retroactive date

This page is general information about how these policies commonly work. Every policy's own forms, endorsements, and exclusions decide what it covers. For advice about your business, talk with a licensed insurance agent.

Before your renewal or your next contract

What to check on your own policy

Whether the policy is claims-made, and the retroactive date
Whether defense costs reduce the limit
The description of your professional services, matched to what you actually do
Contract requirements for limits and duration of coverage after a project
Extended reporting options if you change carriers or close the business

Not sure what your policy says?

Upload your declarations page. The free AI coverage check lists your coverages, limits, and deductibles in plain language and flags items to discuss with a licensed agent.

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Industries that often ask about professional liability

Professional liability questions

Know what you're covered for before you need it.

Check your coverage free in about a minute, then talk with a licensed agent about anything you want to change or quote.