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professional liability insurance in texas

Professional liability insurance in Texas is not mandatory for businesses. However, it is highly recommended. While not every company needs this type of insurance coverage, it’s more necessary than you might think!

Second Western Insurance Services offers professional liability insurance in Texas, California, Arizona, and Nevada with an expansive menu of coverage choices so you can protect your business from expensive lawsuits for accidental errors and omissions, negligence, and malpractice.

Continue reading to learn more about professional liability insurance in Texas to discover where gaps in your coverage may be and how to protect yourself from costly legal fees fully.

What is Professional Liability Insurance in Texas?

Whether you call it professional liability insurance, medical malpractice insurance, or errors and omissions coverage, it’s all the same. Professional liability insurance covers anyone who gives advice or services that can result in financial losses to a patient or customer.

Professional liability insurance protects you and your business from alleged or factual claims against negligence resulting in buyer losses.

While professional liability insurance is not mandatory for all businesses in Texas, if you give advice or offer services in Texas, you’d be wise to consult an expert in Texas insurance to ensure you have no gaps in your coverage.

Professional Liability Insurance vs. General Liability Insurance

General liability insurance protects you from potential lawsuits against bodily injuries, property damage, and advertising injuries like slander or copyright infringements.

In contrast, professional liability insurance protects you and your business from losses that occur from your services.

Suppose you’re an engineering firm offering advice and purchasing building supplies only to have a surplus of material that results in high and unnecessary costs for the builder. For example, the builder might sue you for the losses, and professional liability insurance can help protect your engineering firm from expensive legal fees.

Do You Need Professional Liability Insurance in Texas?

Only some businesses need professional liability insurance in Texas. However, the businesses that benefit from errors and omissions coverage might surprise you; some of them include the following:

  • Accounting and auditing firms
  • Real estate agencies
  • Consulting companies
  • Advertising agencies
  • Interior designers
  • Doctors
  • Architects, engineers, and builders
  • Insurance professionals
  • IT and tech companies

Don’t make the expensive mistake of assuming you’re in the clear with general liability insurance. Talk with an expert Texas insurance professional to find errors and omissions exposures in your business and get covered before costly legal fees come your way.

What’s Covered With Professional Liability Insurance in Texas?

Professional liability insurance in Texas and elsewhere in the United States covers you from some of the following:

  • Negligence or malpractice
  • Violations of good faith or fair dealing
  • Copyright infringements
  • Misrepresentation
  • Inaccurate advice
  • Legal defense fees
  • Damages
  • Medical expenses

This insurance covers unintentional financial losses resulting from improper advice, omission of pertinent information, mislabeling, or malpractice while offering services.

With professional liability insurance, you’re covered up to a certain amount determined by your insurance policy. So, for example, should someone file a claim against you or your company, insurance will help pay for legal fees, which can be exceptionally costly for businesses, especially home businesses in Texas.

Remember, professional liability insurance providers do not cover intentional or illegal acts of malpractice of malintent. Instead, professional liability insurance only covers employees and employers from accidents, errors, or omissions that mistakenly occur during a consultation or throughout the working relationship.

Some of the things professional liability insurance does not cover include the following:

  • Work-related injuries
  • Commercial auto insurance
  • False advertising

How Much Should You Spend on Professional Liability Insurance in Texas?

For those asking how much does professional liability insurance in Texas cost? The answer isn’t one-size-fits-all.

Typically, most Texas small business owners pay between $500 to $1,000 annually for each employee for their professional liability insurance for coverage of one million dollars. Some businesses see higher annual premiums depending on the needed services and coverage. Meanwhile, others pay less than $500 per employee annually for errors and omissions coverage.

Expect yearly rates to nearly double for each employee for two million dollars in insurance coverage. Factors that affect your coverage rates include the following:

  • Company size and number of employees
  • Previous insurance claims history
  • Potential risks for liability

For example, suppose you have 50 employees and get approved for one million dollars of professional liability insurance coverage. In that case, you’d pay around $25,000 to $50,000 annually into your insurance policy.

How To Choose The Best Professional Liability Insurance in Texas

Choosing the right liability insurance is a crucial step to ensuring you get the right coverage for your business. While shopping for professional liability insurance options in Texas, ask questions during the consultation and gauge the provider’s level of communication and clarity.

Consider some of the qualities below when choosing the best professional liability insurance in Texas for your company’s needs.


Seek out an expert in the insurance industry with a deep understanding of insurance law. An expert in their field will find exposures in your policy and give you options to mitigate the risks of liabilities.

Expert insurance agents have years of experience and a professional team ready to assist with research and other legal tasks. However, it takes more than just credentials to be an expert. Your insurance provider should also be an expert at customer service and communication.

Options for Various Choices of Coverage

When looking for the best professional liability insurance coverage in Texas, find a provider that offers various coverage choices.

Some professional liability insurance policies are only for one year and must be renewed annually. Seek out an insurance provider that also offers multi-year coverage that you can switch to as the business relationship develops.

While expertise in professional liability insurance is a must, find an insurance provider that can be a one-stop shop for all your insurance needs.

Stellar Reviews

Good reviews are an excellent gauge of how customers feel after conducting business with a professional liability insurance provider in Texas. Read through reviews before you sign an insurance contract with a new provider.

Seek out an insurance company with plenty of five-star reviews on trusted and honest consumer review sites like Google Reviews, Trustpilot, Yelp, and more. That said, look at some bad reviews to get a feel of some customer pain points. Not every company is perfect, so beware of companies with solely impersonal five-star reviews.

Years of Industry Experience

Expertise accompanies years of industry experience, so these two qualities in an insurance provider typically go hand-in-hand. Search for a professional liability insurance provider in Texas who has over a decade of experience managing clients and their insurance policies.

With years of experience, you can expect a high level of communication, superior performance, more data from reviews, and years of experience networking within the insurance field.


If you’re interested to learn more about professional liability insurance in Texas, check out answers to some of our most frequently asked questions. Or, contact a trustworthy professional for insurance advice at Second Western Insurance Services.

What type of liability insurance is required in Texas?

General and professional liability insurance is not mandatory in Texas. However, it is highly recommended to cover your business, employees, and the owner from being held liable for losses incurred from bad advice or malpractice.

What happens if I don’t have liability insurance in Texas?

If you don’t have liability insurance in Texas, your insurance company does not protect you from claims of negligence while conducting business in your field. Should someone sue you or file a claim against your company, you’ll be responsible for paying out-of-pocket for all legal fees and settlement costs.

What is a professional liability limit?

A professional liability limit is the maximum amount your insurance company will cover. Depending on the insurance company you choose, they may have professional liability limits of two or five million. That said, larger companies can seek out insurance companies with higher professional liability limits to meet their needs. Remember, insurance rates typically rise the higher the limit you select.

Wrapping Up

Professional liability insurance in Texas protects you and your company from paying large settlement fees and penalties for accidental malpractice, improper advice, violations of good faith, or negligence.

While not all businesses need professional liability insurance, many businesses do and are glad to have it if legal issues arise.

Contact an expert professional liability insurance provider today to learn about how to protect you and your Texas business better.