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What Is Professional Negligence?

Kimberlee Leonard
Kimberlee Leonard
business.com Contributing Writer
Updated Aug 02, 2022

Anyone in a professional service can be accused of negligence. Having the right insurance in place is crucial.

Service professionals have an obligation to do their jobs within set standards so that no harm comes to their clients. When a professional performs their duties in a manner that leads to property damage or bodily injury, they may be liable for negligence. Learn how professional negligence occurs, what industries are most at risk and how to reduce the chances of professional negligence claims.

What is professional negligence?

Professional negligence happens when an industry professional doesn’t properly fulfill their duties or obligations. While negligent acts are usually accidents, any resulting harm could lead to massive lawsuits stemming from someone not doing their job properly. Medical malpractice is an example of a professional negligence situation. 

When a professional does a job, they’re expected to take “reasonable care” in carrying out their duties. Reasonable care means that others in the same situation would take specific actions to ensure a positive outcome. Mistakes can happen when someone doesn’t adhere to reasonable care, and professional negligence is the result. 

What professions are vulnerable to negligence?

Certain industries are more prone to cases of negligence. However, negligence can happen in nearly any service industry. Those providing professional services are often held to high standards and can be sued when problems arise. 

These are some of the most common professions vulnerable to professional negligence accusations: 

  • Lawyer
  • Insurance broker
  • Accountant
  • Architect
  • Doctor
  • Realtor
  • Financial advisor

However, other service providers should protect themselves against negligence claims too, such as the following: 

  • Dietitians
  • Physical trainers
  • HVAC installers
  • General contractors
  • Teachers
  • Tutors

Professional negligence is covered by professional liability insurance, sometimes known as errors and omissions (E&O) insurance. This insurance provides a legal defense and pays the claims up to policy limits for professional negligence. 

Bottom LineBottom line: Essentially, no one who provides a professional service is beyond the scope of negligence accusations. This is why having the right business insurance in place is essential.

Examples of professional negligence

There are many examples of professional negligence that happen every day.

Example 1: A surgeon performs the wrong procedure.

A surgeon performs knee surgery on someone’s right knee instead of their left. This is an example of a common negligence incident – and one that has led to many lawsuits. Now, as part of their pre-op procedures, surgeons will meet with the patient and confirm the surgery type and location. They’ll use a Sharpie to mark the surgical spot with the patient watching to ensure it’s correct. 

Example 2: A trainer teaches the wrong exercise form.

Another professional negligence example is a physical trainer who’s sued because a client hurt their back performing an exercise the trainer taught them. The trainer taught and reinforced poor form on the exercise, leading to the client’s injury. Since physical trainers are expected to know and teach the correct form, this is professional negligence.

Example 3: Stairs collapse in a house.

A general contractor builds a house. There is a structural error when they build the staircase, which later collapses, leading to damage to the home and injury to the homeowner. General contractors are expected to do work that meets safety standards, and oversight could result in a lawsuit for professional negligence. 

Example 4: A tutor says a student will get into an Ivy League school.

A tutor boasts about how their students always get accepted to Ivy League schools and promises to do the same for a new client. This sets high expectations when, for many reasons, there’s no guarantee any student will gain admittance to an Ivy League school. Essentially, the tutor shouldn’t set inappropriate expectations, as they could lead to professional negligence accusations.

Did you know?Did you know? A business owners policy doesn’t cover professional liability claims, workers’ compensation, or health or disability insurance. You’ll need separate policies for these coverages.

Determining professional negligence factors

In determining professional negligence, several factors must be considered. Insurance companies, legal teams and courts will want to know exactly how the professional didn’t take the expected reasonable care. 

Here are the determining factors considered in professional negligence cases:

  • The severity of harm: The harmed party must show a significant loss, whether it’s financial or physical. 
  • Course of action: Could the professional have taken a different course of action to get a more desirable result? 
  • Cost: What was the cost of various courses of action, and how would that have factored into the professional negligence incident? 
  • Other options: If the course of action taken was the only course of action available, professional negligence might not be at play. 

Often, the harmed party must provide ample proof to have a valid professional negligence case, such as expert testimony by other professionals in the field who can attest to industry best practices. 

How to avoid claims of professional negligence

You’ll want to avoid lawsuits and professional negligence claims if you’re a professional providing services. Fortunately, you can incorporate some key things into your standard business practices to reduce the chances of someone accusing you of negligence.

1. Use comprehensive contracts.

When you start a new client relationship, ensure that the scope or the relationship and work are explicitly written out in a contract. Contracts don’t have to be full of legalese to be effective. State what you will do, how you will do it and in what time frame. List any exclusions or cases where the contract may be void based on what the customer does. 

Most professionals should have a template contract written by an attorney to use as the basis of every project. Then, all that is required is a scope-of-project addendum to complete the contract. 

2. Set realistic expectations.

Don’t promise the moon to people. Doctors can’t promise 100% healing. General contractors can’t promise to finish a project in record time. Tutors can’t promise that students will ace every exam. 

Ensure clients know what’s reasonable in order to set the right expectations. Take the time to walk the client through what will happen over the course of working together, and set realistic goals. This way, you can prevent the kind of client disappointment that leads to them demanding reparations. 

3. Communicate regularly.

Keep the communication channels open, and talk to your clients regularly over the course of the project or work. The project’s scope may change due to an unexpected realization or occurrence. Professionals with clear and consistent communication are less likely to run into trouble with their clients. It’s important for clients to have the sense that you are always fully committed to their project. 

For example, say a general contractor agrees to renovate a house based on an expected budget and timeline. When the contractor demolishes the part of the house that needs to be redone, they encounter mold issues. While this is unpleasant news, they would call the client, review the problem immediately and offer solutions. 

4. Maintain excellent records.

If you’re involved in a professional negligence claim, the more documentation you have that shows you took reasonable care, the less likely the claim will go anywhere. Keep detailed notes of client meetings and phone calls. Have clients initial or sign off on any project’s change of scope. Things like this will eliminate the “he said, she said” back-and-forth that happens with such allegations. 

TipTip: Becoming a project manager will help people stay on target, track their projects, and document all conversations and occurrences.

5. Talk to other professionals.

Talk to those in your industry and attend industry conferences or professional development classes. This helps you stay abreast of what’s going on in the industry, what others do to protect themselves and how to react when negligence claims occur. Learn from others to help protect yourself. 

How professional liability insurance can protect you

Professional liability insurance isn’t required in all professions. It’s required for professionals such as doctors, but not for physical trainers. Still, even if it’s not required, it can be an excellent idea. Consider your industry and options. Many professionals whose industry has less risk of lawsuits often can get a professional liability insurance policy at a reasonable rate. 

Professional liability insurance is there when someone files an insurance claim or lawsuit stating you didn’t perform your job professionally. It’s different from general liability insurance, which covers you from third-party accidents, such as slip-and-fall scenarios that have nothing to do with your professionalism. 

The best liability insurance providers will offer policies that provide a legal defense for your situation. This includes attorneys’ fees, expert witnesses and investigation services. They will also pay up to a policy’s limit for a settlement or judgment. This means that you likely won’t have to pay anything out of pocket if you get sued. 

Image Credit:

Witthaya Prasongsin / Getty Images

Kimberlee Leonard
Kimberlee Leonard
business.com Contributing Writer
Kimberlee has spent the past 20 years either directly involved in insurance and financial services or writing about it. She’s a former Series 7 and 65 license holder and former State Farm agency owner. As a small business insurance expert, her work can be found on Fit Small Business and Thimble.