What is the Need for General Liability Insurance for a Professional Consultant?

Are you starting your very own consultancy business? You are probably aware that, like with any other business set up, it is very important to protect your consultancy by getting the right insurance coverage. The chances are that you have already heard professional liability insurance can cover you in the event a claim is made against your recommendations or services. In fact, you may already be looking for a comprehensive professional liability insurance plan too. However, do you know that this single plan may not offer adequate cover for your business??

When your Professional Liability Insurance cover is not enough to cover all bases

Yes, professional liability cover is essential for your consultancy, but it’s not quite all you need. You also need to think about a general liability plan to make sure your business is well and truly safeguarded in all aspects. Most consultants do not realize the importance of purchasing this kind of insurance along with the professional liability plan. This is the common thought process that consultancy owners may have: as a consultant, you are offering a service and insuring this (via your professional liability policy) appears to be a comprehensive way to protect your business against legal claims. What is often overlooked is that, no matter what the nature of the business you operate, client interactions are the norm and there is a good chance these interactions may happen at your premises too. Given this, there is a possibility that in some situations, there may be a risk of third-party injuries occurring. Does your professional liability insurance cover this? No, it doesn’t.

So, what happens if a client walks into your office one morning, slips on the wet floor, and in the fall, sustains an injury that requires hospitalization? The client could very well sue your consultancy although your service, that is, the recommendations you gave him, have been right on target in improving his business. You will still face a lawsuit, and you will have to pay damages if he wins the case against you even if you have an ironclad professional liability cover, simply because this insurance does not cover these contingencies that have nothing to do with the actual service you provide.

Here is another scenario for you to think about. A client gives you some data that you need for making your recommendations to them, in a laptop or a hard drive. An accident in your office results in the laptop or hard drive falling to the floor and getting damaged beyond repair. The client decides to sue you for damaging his property that was given into your possession. Does your professional liability insurance cover you for legal expenses arising out of such claims? No, it does not.


General Liability cover to the rescue

It is precisely for such contingencies and many other similar ones that you need a general liability insurance coverage for your business backing up your professional liability cover. Remember, these are situations that ANY business owner can face irrespective of the nature of service he/she offers or the kind of products he/she makes. These situations may be less likely to occur in a consultancy business, but you cannot overlook this risk entirely at all. Since insurance is all about preparing for risks and protecting your business proactively against such risks and the financial burden they represent, you need to safeguard your business with a general liability policy that can absorb the financial drain that legal claims for such occurrences may result in.

Remember that your clients may require you to carry general liability insurance as well as your professional liability insurance too. That means, if you have this insurance cover, you might make a better first impression on prospective clients, especially larger businesses that will look meticulously at-risk preparedness before they hire you as a consultant. Having the right insurance in place enhances your chances of landing big projects in this case.

Now that you know why you need a general insurance policy alongside your professional liability cover, don’t waste any more time in getting your business safeguarded.


As a consultant, you need to safeguard your business against legal claims and the associated costs. While a professional liability cover is an absolute necessity, this is not the only kind of insurance you need. A general liability insurance policy is also important, and now you know why.

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