Everything You Need To Know About Professional Liability Insurance

Businesses in the transportation industry are vulnerable to financial exposures and professional liabilities resulting from mistakes in their services’ performance. Transportation professionals including but not limited to truck drivers, construction equipment operators, charter bus/limo drivers, or public transport operators are at risk of making costly errors in their day-to-day operations. Without the proper education and protection, even a minor oversight or error can have devastating effects on your company. In this blog, we will discuss the importance of professional liability insurance and why you may need it. 

General Liability vs. Professional Liability

When it comes to general versus professional liability in the transportation industry, most business owners believe that general liability insurance offers enough coverage for all their needs. However, while general liability insurance can protect you against common third-party damages or injury claims, it typically doesn’t include coverage for incidents involving employee error or negligence. Due to the nature of the transportation industry, it’s common to overlook a potential error that turns into a professional liability claim. 

Common Professional Liability Claims

It does not matter whether an error is made by the truck driver, administrative personnel, or the business owner themselves, they can all result in lawsuits against the company. Some of the most typical professional liability claims in the transportation industry include: 

  • Shipping delays due to employee negligence
  • Inaccurate or dishonest quotes for services
  • Errors in shipping documents
  • Improper or unauthorized release of goods
  • Misdirected freight
  • Failure to properly insure and secure cargo
  • Negligent truck driver hiring practices
  • Non-receipt of payment

Any error or negligence involved in any step of the transportation process can result in lawsuits from clients. Furthermore, for public transportation services, any injuries or expenses caused directly by the driver can result in claims as well. Professional liability insurance for transportation professionals can provide coverage for the legal defense fees and settlement costs associated with a claim, up to the policy limit. This coverage is essential for small to medium-sized businesses since most can’t afford the financial burden that an uninsured professional liability claim would put them in.

How Does Professional Liability Insurance Work?

Usually, professional liability insurance policies are arranged on a claims-made basis, meaning that coverage is only good for claims made during the policy period. Policies will compensate the insured against loss arising from any claim or claims made during the policy period by reason of any covered error, omission, or negligent act committed in the operation of the insured’s services. Incidents that occurred prior to activating the policy may not be covered, although some specific coverages may include a retroactive date. 

Keep in mind that professional liability insurance coverage does not include criminal prosecution, nor any form of legal liability under civil law, only those listed on the policy. Therefore, those seeking professional liability insurance for their company’s protection should speak to insurance experts before moving forward. 

Stay Protected With RRL Insurance 

If you have any outstanding questions, our team at RRL Insurance would be more than glad to help answer any questions or concerns you may have. We believe the most effective way to make the most out of your coverage is through education, and our team of experts is more than glad to help you navigate the complicated world of insurance. We are in the pursuit of mutually beneficial and meaningful relationships through honesty and integrity. For more information on the services we provide, please contact us today to set up an appointment. 

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