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General Liability vs. Professional Liability Insurance

Many small business owners want to know the difference between general liability and professional liability insurance. Both protect your business against various risks and knowing how they compare can help you choose the right coverage. You might even benefit from having both types of insurance.

Progressive Commercial makes it easy to find a policy that meets your needs. Start an online quote or give us a call to speak with one of our in-house experts.

What does general liability insurance cover?

General liability insurance helps protect your business from everyday risks that can lead to costly claims. It covers accidents and unexpected events that injure others or damage their property. Most small businesses carry general liability because customers, landlords, and business partners expect it. It guards against lawsuits and claims related to:

Bodily injury and property damage: Accidents like a customer slip and fall at your office can lead to claims involving medical bills, property repairs, replacement costs, and related legal expenses.
Personal and advertising injury: This coverage comes into play when someone claims your marketing or advertising damaged their reputation. It can cover issues like libel, slander, defamation, copyright infringement, and privacy concerns.
Products-completed operations: Claims can come up after your work is finished or a customer uses a product you sold. This coverage addresses injuries, illnesses, or property damage that happen after the job is complete.
Damage to rented properties: When you lease a building, general liability insurance can cover damage your business may cause. It can help with claims related to fires, accidents, and other covered events.

General liability doesn't cover property that you own, employee injuries, company vehicles, or professional mistakes.

What does professional liability insurance cover?

Professional liability insurance, also called errors and omissions (E&O), supports businesses that give advice or provide services. It protects you if a client claims your work was careless, negligent, or caused them to lose money.

This type of insurance is important for anyone who advises clients and needs to follow strict professional standards. It can even help in cases where you didn't actually make a mistake. Professional liability can protect you from claims like:

Negligence and mistakes: If you fail to perform expected duties or make a mistake that causes a client to lose money, professional liability can cover the legal expenses.
Misrepresentation and bad advice: If your business unintentionally shares false or misleading information that causes financial or reputational damage, you can be held liable.
Copyright infringement: Using someone else's copyrighted work when creating a product or service for a client can result in a claim. This coverage can pay legal expenses and settlement costs.
Personal injury: Work you create for a client, like a marketing campaign, could lead to claims of slander, libel, or defamation if it makes false statements about a competitor.
Failure to deliver: Missed deadlines and claims that you didn't provide an agreed-upon service might result in legal issues.

Like general liability, professional liability doesn't cover commercial property, employee injuries, or commercial vehicles. Additionally, it doesn't cover bodily injury or property damage.

How are general liability and professional liability insurance similar?

Designed to protect your business, general liability and professional liability insurance can:

Safeguard from potential lawsuits: General and professional liability insurance help minimize the impact on your business's operations after a lawsuit or legal claim.
Provide financial security: Both general and professional liability insurance can protect your financial health. They reduce downtime and get you back in business faster after a claim.
Meet contractual requirements: Some clients or employers set insurance requirements to protect their interests. This means you'll need to carry a certain amount of general liability or professional liability coverage before you can work with them.
Address company-specific needs: General and professional liability insurance can be customized to fit your business. We'll consider things like company size, industry, and risk exposure when helping you determine the right coverage limits and protections.

General liability

Covers physical injuries, property damage, and personal and advertising injury
Triggered by accidents that cause harm, damage, or reputational loss
Example: A landscaper accidentally runs into a customer's mailbox while mowing their lawn.

VS.

Professional liability

Covers financial losses resulting from claims of service-related mistakes or negligence
Triggered by errors or omissions in your work
Example: A marketing consultant falls a month behind on an ad campaign, causing their client to lose money.

Do you need professional liability or general liability for your business?

When choosing general liability vs. professional liability insurance, you'll want to consider the nature of your business, the risks it faces, and the services it provides. In some cases, you might need both coverages.

Follow these steps when determining which types of insurance your small business needs:

Compare liability coverages
List your business activities
Evaluate professional risks
Review past claims
Consider legal and contractual requirements
Consult with a Progressive Commercial agent

Comparing general liability and professional liability insurance cost

Progressive Commercial's 2024 national cost data shows what many small business owners pay for general liability and professional liability insurance:

General liability cost: Small business owners paid a median of $60 per month for general liability. The average cost was $85 per month.
Professional liability cost: The median professional liability premium was $42 per month, and the average monthly cost was $66.

No matter the policy, insurers consider some or all of the following factors when determining your rate:

Industry
Business size
Coverage limits
Claims history
Years in business

The best way to learn what you'll pay for general liability or professional liability insurance is to get a quote. When you quote online, you can compare pricing, explore policy options, and move at your own pace. Prefer to talk it through? Call us to speak with an in-house agent.

Why choose Progressive Commercial for general liability and professional liability insurance

For more than 50 years, small business owners have trusted Progressive Commercial to protect what they've built. We offer a full range of insurance products at a fair price, backed by customer service you can feel good about.

If you need general liability insurance, professional liability insurance, or a combination, our specialists are here to make sure you're covered.

Common questions about professional liability insurance vs. general liability insurance

Do I need both general and professional liability insurance?

Many businesses find that they need both general liability and professional liability insurance to fully protect against the range of risks they face.

For example, companies that offer professional advice or services and engage directly with clients typically require both coverages.

When would I use commercial general liability insurance vs. professional liability insurance?

The insurance you use depends on the nature of the claim. General liability helps with events like bodily injury, property damage, or advertising injury.

By contrast, professional liability insurance covers claims related to negligence, failure to deliver services, misrepresentation, or bad advice.

How do I decide between general and professional liability insurance?

When deciding between general and professional liability insurance it's important to consider the risks your business faces and the nature of the claims you might encounter. In many cases, businesses benefit from having both coverages to protect their company fully.

Even after selecting a policy, it's a good idea to review your coverage regularly. As your business evolves and changes, your insurance needs do, too.