Professional Liability Coverage: What E&O Pays and Excludes
Professional liability coverage, also called errors and omissions, pays when a client alleges your professional work or advice caused them a financial loss. This page is the coverage mechanics: what triggers it, what is excluded, and what it costs. For who is required to carry it by profession, see the professions index. Beaconcover is not a licensed broker; we explain the coverage and route you to carriers.
The short answer
Professional liability pays a client's financial-loss claim arising from your service, advice, or work product, a missed deadline, a design defect, a filing error, a recommendation that lost money, plus the legal defense, up to policy limits [NAIC: small business insurance, 2026-05]. It does not pay for someone tripping in your office or physical property damage; that is general liability. Most policies are claims-made, which makes the retroactive date and tail coverage matter.
What does professional liability cover?
It responds to negligence, errors, or omissions in the professional services you provide: failure to deliver as promised, mistakes in work product, missed deadlines or filings, and inaccurate advice that causes the client a measurable financial loss, with legal defense included [NAIC: small business insurance, 2026-05]. It is the core line for consultants, agencies, accountants, attorneys, architects, agents, and other licensed professionals, and many of those licenses or client contracts require it. Limits are commonly written at $1M per occurrence and $1M aggregate; the required amount is often set by the client contract itself rather than chosen by the buyer.
What it excludes
Professional liability excludes bodily injury and property damage (general liability), employee injuries (workers' compensation), intentional or fraudulent acts, and known claims or circumstances that predate the policy. The claims-made structure is the trap: a claim is covered only if both the policy is active when the claim is made and the work occurred after the retroactive date, so switching carriers without continuous coverage or tail protection can leave a gap [III: business insurance basics, 2026-05].
Typical cost
Cost depends on profession, revenue, services offered, claims history, and limits, so it varies widely and a single national figure is misleading [NAIC: small business insurance, 2026-05]. Advice with high financial stakes (financial, legal, design) prices higher than low-stakes services. Beaconcover does not publish a premium it cannot source; profession-specific sourced ranges are on the profession pages, and the GL vs professional liability pillar explains when you need both.
Where to get quotes
Quote with carriers that underwrite your profession specifically, since profession-matched terms respond more accurately to a claim than a generic policy. Get two or three quotes and confirm the retroactive date when switching carriers. See /methodology/ for what to look for in any plan.
Frequently asked questions
A client's financial-loss claim from your professional work or advice: errors, omissions, missed deadlines, defective work product, plus legal defense.
Not a broker. Beaconcover is an independent comparison site. We are not a licensed insurance broker, agent, or adviser; we route you to providers and do not sell, bind, or advise on policies, and nothing here is legal or tax advice. Coverage, price, and requirements vary by state, profession, payroll, and underwriting. See /methodology/ and /disclosure/. Last reviewed: 2026-05-16.