General vs Professional Liability: Match the Risk

General liability commonly addresses categories such as third-party bodily injury and property damage, subject to the contract. Professional liability concerns covered errors or negligence in professional services. The names do not mean every loss is included. For a hypothetical design studio, a visitor slipping in the office and an alleged costly design error are different scenarios. Write the events in plain language before asking a broker which coverage might respond and what would remain excluded.

Read the named insured, business description, territory and covered services. A policy arranged for one activity may not match a later expansion into installation, consulting or product sales. Ask about subcontractors and contractual promises rather than assuming they are automatically included. A client’s insurance requirement is a useful review input, but simply meeting a stated limit does not prove the policy covers the service you actually sell. Keep the proposal and accepted policy wording together.

Ask whether coverage is occurrence-based or claims-made, and what reporting, retroactive-date or extended-reporting provisions apply. Compare per-claim and aggregate limits, deductibles or retentions, defense-cost treatment and exclusions. In a hypothetical comparison, a cheaper annual premium can leave a larger uncovered first-dollar exposure. Request the same scenario analysis from competing providers so you are not comparing one policy’s price with another policy’s broader protection. Avoid reducing the decision to the premium alone.

Assign a contact to notify the broker or insurer promptly when a potentially covered event occurs, following policy instructions. Preserve the customer contract, work records and correspondence without admitting liability or promising a payment on the insurer’s behalf. Review insurance after a new service, location or major customer agreement. Neither general nor professional liability automatically replaces workers’ compensation, cyber, property or commercial auto coverage. Build a risk map that shows those separate questions and the evidence used to answer them.