So, you have researched broadly and decided that you require professional liability insurance, right? You are on the right track. After all, better safe than sorry. Before you settle for a policy, you should note that not all policies are the same. Before signing the dotted line, it is advisable to consult your insurance agent for guidance on everything regarding the professional liability insurance offers.

As you get started, here are six questions you can ask the agent regarding the cover:

Does the policy offer claims-made coverage?

Claims- made coverage implies that for you to receive the benefits, your policy should be active at the time. Most E & O policies operate on this basis. Two time factors are considered:

• When was the claim over the initial incident filed?
• When did the alleged incident first occur?

If the policy is a claims-made policy, it means that you will only receive compensation if the two conditions are met. If an incident takes place while your policy is still active but a lawsuit from the said event occurs years later when you are no longer on the policy, then you will not receive coverage. That is why cancelling your claims-made policy is not a good idea. At times, a claims-made policy might protect you against incidences that occurred before you purchased the policy. Ask your agent about this.

What is my deductible?

A deductible refers to the payment you must pay before you can receive the insurance benefits. For instance, if your deductible is $1000 and a claim costs $5000, you are supposed to pay $1000 while the insurer pays the rest. A high deductible is advisable for those who think they might face several claims, or are worried about expensive claims. A low deductible is better for those who are likely to face several inexpensive claims. Remember to ask your agent for advice on the most appropriate for your business.

Will my policy cover me if a sue someone?

Most policy will not cover you if you decide to sue other businesses. In case someone causes harm to your company, you can recoup your loss through other policies such as property insurance. Again, talk to your agent about this.

What are the limits?

The limits for your E & O insurance are the maximum amount payable in the event of a claim. It might be broken further into sub limits. For instance, a general liability cover might be worth $1,000,000 but you only get $10,000 for medical expenses. Therefore, discuss the terms of the policy with your agent.

What happens in case I skip a payment?

Most policies will provide a grace period, which means you are covered for a certain period if you do not renew immediately. Usually, failure to pay premiums beyond this period means you lose the coverage. You might want to talk to your agent about the most appropriate payment plan.

Will the insurer assign me a lawyer when am sued?

Some policies stipulate that the insurer will cover for the legal expenses and also offer you a lawyer in case of a lawsuit. Other policies will require you to find your lawyer then compensate later. Talk to your agent about this issue.