Apply now for the Gloria Archer Legacy Bursaries.  Click here to learn more   


Professional liability insurance

Professional liability insurance or PLI is an insurance that protects professionals from claims brought by clients for negligence or other reasons. Often, general liability insurance does not cover lawsuits stemming from professional or business practices such as malpractice, carelessness, or misrepresentation. Therefore, professionals in fields that are prone to these types of lawsuits need to purchase professional liability insurance policies to make sure they’re protected.

Errors and omissions insurance

Errors and omissions insurance (E & O insurance), professional liability insurance, or medical malpractice insurance protect you from lawsuits alleging that you made a mistake while providing professional services. This insurance can assist in covering court fees or settlements which might be prohibitively expensive for you or your company to pay on its own.

This insurance covers you and/or your company against allegations of:

  • Omissions
  • Negligence
  • Incorrect advice
  • Misrepresentation
  • Errors in services provided

The insurance is only valid if:

  • The claims occurred during or after the retroactive date
  • It is filed within your extended reporting period or policy period
Insurance Image

Industries that need professional liability insurance

Every company or industry that offers professional services should consider getting professional liability insurance. The following are some examples of firms that may require this coverage:

  • Auditors and accountants
  • Consultants
  • Engineers
  • Architects
  • Real estate agents
  • Professionals in the insurance industry

Before clients agree to patronize your business, they may ask that you have an insurance policy in place. They want to ensure that if your organization fails to fulfill its promises or violates the terms of the contract, they will be compensated.

If a customer requests professional liability insurance, you must present a certificate of insurance that provides evidence of coverage and specifies the policy limitations.

insurance image transparent

Do you have enough coverage?
Let's find out.

Why you need professional liability insurance

Professional liability insurance is a critical component of any risk management strategy if you provide a service or make a career from your knowledge. It's the only commercial insurance covering you in the event of a lawsuit stemming from your work performance.

Professional liability insurance covers claims alleging that your error or negligence resulted in a financial loss regardless of guilt. To compare, general liability insurance covers legal proceedings alleging property damage, Bodily injuries, and copyright infringement and other additional exposures but not for your knowledge.

A design miscalculation, for example, could result in a costly disaster for an architect. If a customer fails to meet their earnings target, a business adviser could be held responsible.

insurance image transparent

What professional liability insurance covers in Alberta

Professional liability insurance covers lawsuits alleging misconduct, carelessness, or failure to complete a service as promised as well as customer claims asserting financial damage as a result of a service you provided.

Professional Liability Insurance in Alberta often covers legal fees and damages connected to the following categories of coverage:

  • Products: Insurance for bodily injury or product failure (for instance, a product that failed to work as intended)
  • Advertising and Media: includes media services that result in a defamation, slander, or libel lawsuit against your client
  • Professional Services: PLI also provides coverage for omissions or errors or negligent acts related to the services you provide, including failure to deliver products or services when due

What professional liability insurance does not cover in Alberta

Professional liability insurance does not cover criminal prosecution or other legal liabilities related to civil law; it only covers liabilities that the policy specifies. Cyber liability which covers data breaches and other technical hazards isn't part of standard policies, however, different policies can protect data security and other technological threats.

The cost of professional liability insurance in Alberta

The cost of professional liability insurance is adjusted to account for the reality that no two companies are alike, so this is only a rough guideline.

Learning which aspects of your organization have the most significant impact on the cost of insuring your small business will help you make cost-effective decisions. Our brokers are also happy to help you figure out what will work best for you.

Factors that affect the cost of professional liability insurance

Several factors can contribute to the cost of professional insurance coverage, including:

Type of business/services you offer

The type of services you provide and the industry you operate in can impact the cost of professional liability coverage. The risk profiles of different businesses and professions differ significantly.

If your company deals directly with clients, your insurer may view it as a higher risk. As a result, an accounting firm's professional liability insurance cost is likely to be greater than a landscaping firm. Similarly, an optician has a lower risk than an ophthalmologist, despite the similarity of their professions.

Level of expertise

Your professional liability quote may be a little more expensive if you've been in business for only a few years. Many insurers believe that the less expertise you have, the higher the risk you pose. If your company has been running for several years and has a track record of financial security, your estimate may be less.

Policy limits

You can specify the coverage limits you desire in your professional liability insurance policy when you purchase it. These limits might be anywhere from $250,000 to $2 million.

Number and types of employees

Your premiums may increase if you cover many key employees with your PLI. That's why it's critical to notify your agency if you later fire or hire personnel. If someone stops working for you, you don't have to continue paying for their insurance.

If you hire independent contractors who don't have professional liability insurance of their own, you may need to cover them in your policy.

Type of clients

Your insurance cost may be extremely high if your clients invest a significant amount of money in your business and are likely to lose a big chunk of it if something goes wrong.

For example, a software developer who works with clients who handle a lot of financial transactions may have a high insurance rate because there are large amounts of money involved. 

In that case, extra insurance to handle the claim would be needed because the damages could be up to millions of dollars. This is why we’ll inquire about the cost of your most significant projects in order to assess this kind of risk. 

Claims history

Professional liability costs can rise if your company has a history of professional liability claims. This is why it makes sense to make sure your company has a comprehensive training program to limit the chance of errors in your services to avoid potential claims.

Factors that increase the cost of professional liability insurance

The level of risk that your business carries will determine if the cost of your professional liability insurance. Also, companies with a history of liability lawsuits are likely to have higher professional liability insurance than those with none. Your company revenue can also increase the cost of professional liability insurance as a higher income will mean higher insurance fees.

Businesses with low risk and no history of claims will have lower professional liability insurance costs.

Have a question? We'll reach out.

If you're looking to learn more about what we offer, we'll email or call you to answer any questions you may have. Our team is flexible, approachable, and ready to make the process as easy as possible.

Or if you prefer...

Book an Appointment

Submitting a professional liability insurance claim with Knight Archer

If a client serves you with a lawsuit and you must make a claim with your insurance company, you should follow these steps:

  • Call the claim number on your insurance policy
  • Fill out any paperwork related to your claims
  • Provide all relevant documents to your insurance company representative. The documents will include every interaction with the client as well as details of the work you did
  • Ask your insurance provider whether they will assign you a legal counselor or if you should hire your own
  • Follow the instructions of the insurance representative 
  • Also, you should avoid the following legal pitfalls:
  • Never confess to negligence or agree to a monetary settlement
  • Never sign a client's paper without first discussing it with your representative
  • Do not attempt to correct any purported errors or omissions
  • Do not inform outside parties about pending legal actions
Car Insurance Image

Get a professional liability insurance quote

Our expert team of brokers will help you find the best professional liability insurance to fit your business needs.


If you prefer in-person or over the phone, you can always chat with one of our account executives. 

Book an Appointment

Professional Liability Insurance FAQs

What is the difference between general liability insurance and professional liability insurance?

One significant distinction between professional and general liability is the types of risks they cover. Professional liability insurance protects your company against abstract threats like omissions and errors in the services it provides. However, general liability insurance covers physical risks like property damage or bodily injuries.

Also, professional liability insurance is for anyone operating as a company or providing a service of some sort. PLI covers professionals such as doctors, engineers, consultants, lawyers, or anyone who provides an analysis or opinion of some sort and puts their professional stamp or name behind it.

Is professional liability insurance required in my province?

Yes, it is for some industries. For instance, if you’re a professional engineer needing commercial liability insurance for your services, you’ll need professional liability insurance as well because general liability recognizes that you’ll be giving people advice.

Engineers have professional risk because they could create an unsound structure that causes injuries or loss. In such cases, the owner of the building may go back to the engineer to sue them.

Mistakes or inadequacies are professional risk instead of an operational risk, so that’s why it’s professional liability insurance that takes care of the cost of the lawsuit in this example.

Is professional liability insurance expensive?

The price of professional liability insurance depends on various criteria, including the type of business, its location, and any prior claims the business owner has paid out. A person or company with a history of legal issues faces a higher risk, making professional liability insurance more expensive as a result.

When should I buy professional liability insurance?

You’ll need to get professional liability coverage for your company as quickly as possible. Professional liability insurance can only protect you against a claim if the incident and lawsuit occur while the policy is in effect. Sometimes, several months or years may pass after an incident occurs before a lawsuit is filled which is why it’s crucial to have uninterrupted insurance.

Will professional liability insurance protect me even if the litigation is unsubstantiated?

Yes. Whether or not your insurance company finds the claim against you to be frivolous or not, your professional liability insurance will protect you from a lawsuit alleging professional negligence.

Proudly serving you across the prairies

View our locations


left quote

I went to this Knight Archer office to get a few important documents notarized. I was received by a staff at the counter and transferred my request to an official who dealt with my request. The notary who helped me with my documents provided me with the best service I've ever received thus far in Canada. She was very much courteous with the service and I just want to point out that Knight Archer staff does very well treating their customers. I appreciate it very much and encourage the management to continue doing the same.

right quote

Robin John


left quote

I was blown away with the service I received here by both Lisa and Vlera. I had a bit of a complicated situation and felt caught between provincial systems but both women worked the problem with me until we had a good solution. Extremely helpful, professional and made what was tricky a good experience.

right quote

Tasha Cox


left quote

I wanted to get home insurance and was helped by Karen Filleul. Being a first time home buyer, I couldn't have asked for a better person to help me with getting home insurance than Karen. She was extremely thorough, prompt and professional, and was able to get me the best deal. Thanks to her and the rest of the staff at Knight Archer for delivering top notch customer service.

right quote

Gagan Gill


left quote

Always a pleasant visit! Friendly, knowledgeable and efficient staff make for a quick and easy process!

right quote

Stephanie K


left quote

People from a variety of ethnic backgrounds work here making them great at serving and supporting a vast customer base.

right quote

Deej Patel


left quote

The team is very good at Knight Archer Insurance, I visited that place first time and it's totally new place for me (New Immigrants In Canada) they explained everything with very easy way and gave me some extra knowledge about the future process as well.

right quote

Shail Patel

Let's get started!

Our expert team of local brokers will help you find the best coverage possible.