Business
General Liability vs. Professional Liability Insurance
General liability data from Insureon's small business dataset; professional liability (E&O) data from the same source, same customer profile, updated August 2026.
Two policies both called "liability insurance," covering two genuinely different kinds of claims. Here is how to tell which one your business actually needs, and what each one costs.
Data sourced from Insureon
The one-sentence version
General liability covers claims that you physically hurt someone or damaged their property. Professional liability, also called errors and omissions (E&O), covers claims that your professional work or advice cost someone money without physically hurting them at all.
Both are "liability" insurance in the sense that they respond to a third party's claim against you, but they are priced separately, sold separately, and cover almost entirely non-overlapping situations.
What triggers each one, in practice
A general liability claim looks like this: a client visiting your office trips and breaks a wrist, or a contractor's crew accidentally cracks a client's foundation while working.
Someone was physically hurt, or something physical was damaged. A professional liability claim looks entirely different: an accountant misses a deduction that costs a client a five-figure tax bill, a consultant's recommendation leads a client to a bad business decision, or a web developer ships a bug that costs an e-commerce client a week of lost sales.
Nobody was physically hurt in any of those. The client lost money because of the quality of the work or advice itself, exactly the gap general liability was never designed to cover.
What each one actually costs
Insureon's small business data lets these two be compared fairly, since both figures come from the same roughly 100,000-customer dataset (mostly under 5 employees, under $200,000 in revenue), not two incompatible sources.
Professional liability averages $88 a month, or about $1,051 a year, somewhat higher than general liability's typical range for most industries. Like general liability, the profession you are in moves the price a lot:
- Notaries public: about $41/month (roughly $492/year)
- Bookkeepers: about $42/month (roughly $504/year)
- Consultants: about $63/month (roughly $756/year)
- Insurance agents: about $92/month (roughly $1,104/year)
- Engineers: about $144/month (roughly $1,728/year)
The pattern tracks the size of a plausible mistake, not just general business risk. A notary's or bookkeeper's error is usually a bounded, correctable amount of money. An engineer's design error or an insurance agent's coverage mistake can trigger a claim worth vastly more, and the premium reflects that directly.
For a consulting or IT business specifically, general liability runs about $384 a year while professional liability runs about $756 a year, nearly 2x higher, a good illustration of how differently the two policies price the same underlying business.
Who typically needs both
Plenty of small businesses need both policies at once, not one or the other. A general contractor who also designs the work they build carries physical on-site risk (general liability) alongside design or workmanship error risk (professional liability).
A marketing consultant who visits client offices and also gives strategic advice has the same overlap in miniature. As a rough rule, if your business ever performs a service, gives advice, or makes a professional judgment call that a client relies on, professional liability is worth pricing out even if you already carry general liability for the more physical side of the business.
Frequently asked questions
Can one policy cover both general liability and professional liability?
Rarely as a single bundled product. Standard Business Owners Policies (BOPs) package general liability with commercial property coverage, not professional liability. A handful of insurers sell combined general liability and professional liability packages for specific industries like consulting or IT, but most businesses that need both carry two separate policies rather than one that does everything.
I only give advice remotely and never meet clients in person. Do I still need general liability?
Professional liability is the more obviously relevant policy for pure remote advice, since your main exposure is a client claiming your advice cost them money, not a physical injury.
Many clients and platforms still require proof of general liability before signing a contract regardless of your actual physical risk, so check your contracts before assuming you can skip it entirely.
Why is a consultant's professional liability pricier than their general liability?
For a consulting or IT business, Insureon's data puts general liability around $384 a year but professional liability around $756 a year. That reflects where the real risk sits for that kind of business: a consultant rarely injures anyone or damages property (the low general liability price), but a mistake in the advice or work itself is the actual likely claim (the higher professional liability price).
Is E&O insurance the same thing as malpractice insurance?
Functionally, yes. Errors and omissions (E&O), professional liability, and malpractice insurance all describe the same underlying coverage, a claim that your professional work or advice caused someone financial harm.
The name that sticks tends to follow the industry: doctors and lawyers usually say malpractice, consultants and tech businesses usually say E&O or professional liability.