What Is Miscellaneous Professional Liability ? And Why Your Company May Need It

Does your company: What is Miscellaneous • Provide to others for a fee? Professional Liability? • Sign service requiring it to carry professional liability insurance? Miscellaneous Professional Liability • Have clients that incorporate your results from errors or omissions in the services into the products or services performance of professional services. they provide to others? Companies that perform professional • Hire and oversee subcontractors to services for others can make mistakes— perform certain services for your overlook a critical piece of information, clients on your behalf? misstate a fact, be misunderstood, forget • Sign service agreements with clients an essential step, etc.—and be subject to requiring confidentiality of proprietary allegations such as: business information? • Errors or omissions in providing a If you answered yes to any of these service questions, your company may face • Failure to provide a service in a timely significant professional liability or at all exposure. • Misrepresenting the service to be performed

It doesn’t help that professional service firms today offer their services in a business climate that features:

• A lawsuit-conscious public fueled by media publicity, a belief that everyone deserves to be compensated and the idea that there is always a “deep pocket” with the ability to pay • A continuing escalation of court settlements into the millions of dollars • Punitive damages that in some states can be doubled or tripled Do You Need Miscellaneous What Types of Companies Purchase • Reputation for paying claims and Professional Liability Insurance? Miscellaneous Professional superior service: Our reputation Liability Insurance? for expert, fair claims handling is Consider the impact. According to a 2019 renowned in the . Chubb study of MPL claims data from Chubb offers Miscellaneous Professional • Broad coverage: Our Miscellaneous 2009-2015, the average total loss for an Liability insurance to more than 60 Professional Liability insurance MPL claim reported to Chubb was types of service providers, as well as to products offer some of the broadest $227,000, with an average payment hundreds of unique service firms. Among coverage available in the marketplace. amount of $164,000 for loss paid by the most common classes of service We provide this coverage on a Chubb in excess of the Insured’s self- providers are: monoline policy form or as part of a insured retention. Most companies can’t suite of specialty liability coverages. absorb that kind of loss without feeling • • Flexible appetite: We combine a dramatic, possibly devastating, effects. • Outsourced business process standardized approach to comon Yet such costs are only part of the administrators (e.g., payroll processors, classes of professional service financial pain—it’s difficult to place a benefit plan administrators) providers with a flexible, customized value on the distraction, lost time, and • Travel agents and other event planners approach to unique service firms that damaged reputation that may result from • Property managers fall outside of these classes. a professional liability lawsuit. • Applied arts professionals (e.g., interior designers, graphic designers) A professional liability lawsuit can be To Learn More triggered by almost anyone who is If you are unsure whether your company impacted by the professional service. For should purchase Miscellaneous For more information on MPL Insurance, example, the recommendations a human Professional Liability insurance, consider please contact your insurance resources makes to an whether your company’s decision not to agent, or visit www.chubb.com/us/ can affect thousands of purchase this insurance would put your professionalliability. people. Service providers should company at a competitive disadvantage, consider the types of businesses and especially if your prospective customer individuals that may rely on their services requires its service providers to carry and the degree to which those parties E&O liability insurance. could be impacted by a real or perceived error. The broader the exposure, the greater the need for insurance protection. The Chubb Advantage

Another important thing to remember is Chubb has earned its leadership position that your company doesn’t have to do in professional liability insurance as a anything wrong to be sued. In fact, a large result of our: proportion of lawsuits are meritless. Even so, such lawsuits must be defended, and • Financial stability: Chubb that can be costly. Professional liability receives consistently high ratings insurance provides coverage for these for financial strength from A.M. Best, legal defense costs. Moody’s and Standard & Poor’s, the leading independent analysts for the Service providers are often contractually insurance industry. required to carry E&O liability insurance. Yet, according to a Chubb study, nearly half of the firms that are required to purchase this insurance don’t actually do so, perhaps under the mistaken belief that they already have coverage. These companies may be exposing themselves to greater liability, not to mention a possible breach of claim. You don’t want your company to fall into this potentially costly position.

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