Knowledge Base: Who is Covered Under My Professional Liability Policy?

May 13, 2013
If you are starting a new firm or buying Professional Liability Insurance for the first time,  you might be asking yourself: "Who is covered under my policy?". Well, Protexure is here to help with all of your questions and concerns. As part of our new series of blog posts called "Knowledge Base", we aim to answer frequently asked questions regarding Professional Liability Policies in detail. We want you to be well-equipped when evaluating different carriers in the future. What is an "Insured"? Under a Professional Liability Insurance Policy, the definition of an “Insured” can include a number of different people and entities. First, the name of your firm is an Insured. This typically refers to the legal name of your firm. If you practice under multiple names, make sure to report the other names on your application. The name of the firm is typically referred to as a “Name Insured”. Next, employees of the firm are defined as Insureds under the Professional Liability Policy. This includes but is not limited to principals, partners, officers, members, or other employees of the Names Insured. Another feature to look for in a Professional Liability Insurance Policy is the inclusion of contract employees working for the firm as Insured parties. During tax season, for example, your firm may hire temporary workers to compensate for a significantly increased workload. Coverage is available for the work they do on behalf of your firm, though it is often different from carrier to carrier. Also included in the definition of an Insured is the estate, heirs, administrators, or legal representatives of either the names or the people noted above (partners, officers, members, etc.) in the event of death, incapacity, bankruptcy, or insolvency. Going along with this idea, another entity that is potentially covered in your policy is called a “Predecessor in Business”. It is typically defined as another entity whose financial assets and liabilities become owned by the Name Insured. An example would be a merger/acquisition of another firm into your practice. We will go over predecessors in more detail in a future post! We hope this post helps answer questions you may have about your policy! If you are a small CPA Firm, we would love to provide you with a quick, free, and competitive quote for your firm's Professional Liability Insurance. Give us a call at (888) 803-9898 or visit our website at For the latest news in Accounting today, be sure to check out our Facebook and Twitter pages, and of course: our WordPress Blog!

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