If your business offers services to another, you face inherent exposures. MI Professional Liability Insurance is a must for professional service providers as it provides protection against a variety of risks you may encounter. With that said, the dangers of going without it can devastate a business. For smaller endeavors that don’t have the financial capital to recover from a lawsuit, this protection is critical. Let us examine the risks of going without this insurance.
Cavignac & Associates defines professional liability insurance, or errors and omissions insurance, as malpractice insurance. It is purchased by architects and engineers as well as doctors, lawyers, accountants, real estate brokers and other licensed professionals to address business liability risks that arise from rendering professional services.
To put it into perspective, the average cost of a professional liability claim is about $475,000. Depending on the size and financial structure of your business, this could cause you to permanently shut your doors. If you’re able to remain in business, you may be coerced into raising prices or laying off employees to recover from such a big expense.
What does this policy cost? While many assume the coverage is not affordable, this is a common misunderstanding. Professional Liability insurance typically costs between 1 and 3 percent of the company’s total yearly revenue. When considering paying this small fee as opposed to hundreds of thousands out of pocket, it’s worth the investment.
Furthermore, this coverage is required in many states. If your business was to be sued and you weren’t insured, you could face more penalties and fines. Therefore, it’s important to keep these facts in mind when determining which policies are best suited for your business.
At Thayer-Innes Insurance Agency and Freeman Bunting Insurance Agency, we strive to provide comprehensive yet affordable packages to support Ann Arbor businesses, including protection from claims resulting from negligence, false advertising, misrepresentation, libel, slander and more. For more information about our products, contact us today at (855) 395-6316.