General Liability vs Professional Liability: Which Claims Each One Pays
One covers what you broke. The other covers what you got wrong. Almost no service business needs only one of them.
- General liability pays for bodily injury and property damage to third parties
- Professional liability pays for financial loss from your advice, designs or services
- General liability excludes professional services explicitly
- Professional liability is usually claims-made; general liability is usually occurrence
- Client contracts frequently require both, at stated limits
The dividing line
General liability answers physical harm: a visitor falls in your office, your crew damages a client’s wall, a product injures someone. It is occurrence-based, so the policy in force when the incident happened responds even if the claim arrives years later.
Professional liability, also called errors and omissions, answers financial harm from your work: advice that cost the client money, a design error, a missed deadline, a specification that was wrong. It is usually claims-made, so the policy in force when the claim is reported responds — which makes your retroactive date critical.
Four claims, sorted
A client trips over your equipment bag and breaks a wrist. General liability.
Your consulting plan omits a regulatory requirement and the client spends $260,000 remediating. Professional liability.
Your technician cracks a client’s countertop during installation. General liability.
Your bookkeeping error triggers $18,000 in tax penalties. Professional liability.
The pattern is consistent: if the damage is to a body or to tangible property, general liability. If the damage is to a balance sheet, E&O.
Why the exclusion matters
General liability policies contain a professional services exclusion. It is not an oversight — it is the boundary that makes the two policies distinct, and it is why "I have general liability" is not an answer to a negligent-advice claim.
The corollary catches people the other way too: E&O does not pay for a slip and fall in your office. Neither policy backstops the other.
Who needs both
Anyone who gives advice, designs, specifies, certifies or configures, and also has clients, premises, or field work. That covers consultants, IT firms, architects and engineers, accountants, agencies, inspectors, and most trades that do design-build work.
Contracts usually settle the question anyway — commercial clients routinely require $1 million general liability and $1 million professional liability before they will onboard a vendor.