If you’re in the market for business insurance, chances are you’ve come across two very similar sounding policies in the form of professional indemnity insurance and public liability insurance. While there are some similarities between these two types of cover, there are some key differences you should be aware of as well.
Public liability insurance protects you against claims where you are the subject of a liability lawsuit and are liable to pay damages.
Professional indemnity insurance is for professionals who offer advice or a service to their customers. If you make a mistake or omission while offering your professional services to a client, and this results in your client suffering a loss, they may file a claim of professional negligence against you. Professional indemnity insurance offers protection against such claims, providing cover for legal and court costs as well as any damages or compensation you may be required to pay.
With this in mind, professional indemnity insurance provides cover in the event you breach your professional duty. However, it’s important to remember that all businesses have a responsibility to the general public. So rather than cover breaches of professional responsibility, public liability insurance covers you for breaches of your general responsibility as a business owner.