General vs Professional Liability

General liability pays for injury, professional for the work

General liability and professional liability answer different harms. General liability pays when a business injures someone outside it or damages property belonging to someone else. Professional liability pays when a client loses money because of a mistake, an omission or bad advice in paid professional work.

The split is physical harm against financial harm. A customer who trips in the lobby is a general liability claim, and a client who acted on a wrong recommendation is a professional liability claim.

Neither policy answers the other’s claims. The standard commercial general liability form carries a professional services exclusion, so a Texas firm holding general liability alone has a coverage gap rather than a low limit when a client sues over advice.

What general liability pays for

General liability insurance covers bodily injury and property damage to third parties, plus personal and advertising injury, on a standard commercial general liability form.

What the form answers:

• Bodily injury to a customer, a visitor or a passer-by
• Damage to property the business does not own, including a client’s building during work
• Personal and advertising injury, which covers libel, slander and using someone else’s advertising idea
• Medical payments, a small no-fault amount for a minor injury
• Defense costs, which the insurer owes whether the claim has merit or not

Faulty work is the exclusion that surprises Texas contractors. A general liability policy pays for the water damage from a bad installation, and it does not pay to redo the installation. General Liability Insurance in Texas sets out the whole form.

What professional liability pays for

Professional liability insurance, also called errors and omissions coverage, pays when a client suffers a financial loss because of the professional work the business was paid to do.

What the form answers:

• A negligent act, error or omission in the professional service
• A failure to deliver the service at all, or on time, where the client loses money
• Defense costs, which commonly erode the limit rather than sitting outside it

Professional liability is written claims-made, so the policy that responds is the one in force when the claim is made rather than the one in force when the work was done. Three dates control it: the retroactive date, the policy period and the extended reporting period. Professional Liability Insurance in Texas sets out those dates.

General liability and professional liability compared

General liability and professional liability differ on six points a Texas owner can check against a contract.

Criteria	General liability	Professional liability
Harm covered	Bodily injury and property damage	Financial loss from professional work
Who is harmed	A customer or a third party	A paying client
Trigger	An occurrence in the policy period	A claim made in the policy period
Common name	CGL, the third-party policy	Errors and omissions, E&O
Defense costs	Commonly outside the limit	Commonly inside the limit
Packaged into a BOP	Yes	No, written separately

Claims-made against occurrence is the line that matters most at renewal, because a Texas firm that loses its retroactive date wipes out years of completed work.

Which policy a Texas contract is asking for

A Texas insurance clause names the policy it wants, and the wording is usually specific enough to tell the two apart.

How the clause reads:

• “Commercial general liability” with per-occurrence and general aggregate limits means general liability
• “Professional liability”, “errors and omissions” or “E&O” means professional liability
• “Technology E&O”, “miscellaneous professional liability” and “design professional liability” are professional liability under a class-specific name
• A clause demanding both names both, usually with a separate limit for each

Texas sets no liability limit for most private businesses, so the number in a clause is a private requirement rather than a legal one. Licensed trades are the exception: Texas Occupations Code §1305.159 makes an electrical contractor prove financial responsibility.

Why a Texas business often carries both

A Texas business that sells advice and also lets customers through a door carries both exposures, and each policy answers only its own.

Who usually carries both:

• Accounting, legal and consulting practices with a client-facing office
• Marketing and advertising agencies, where advertising injury and professional error sit side by side
• Architects and engineers, whose drawings create a professional exposure and whose site visits create a premises one
• Insurance agencies, technology services firms and real estate offices

A professional practice commonly needs general liability, commercial property and professional liability together, so the whole account can sit on one submission. Texas Business Insurance sets out every line the agency places.

Where Aulona Insurance Group is not the right fit

Aulona Insurance Group places general liability and professional liability inside its package lines, which are a business owners policy, general liability, commercial property and professional liability.

Classes with no market on those lines:

• Roofing and siding, a no-market problem rather than a pricing one
• Night clubs, gas stations, towing operators and auto dealerships
• Hospitals and physician practices, where the exposure is medical rather than premises
• Marijuana and cannabis businesses
• Used-goods dealers and non-durable goods wholesalers
• Livestock operations and pet breeders

Commercial auto sits outside those package lines, and a commercial auto question is answered on the recorded call with Luka Cenaj. Life, health, Medicare and disability coverage are not written at all.