Professional Services Insurance in Texas

What professional services insurance covers in Texas

Professional services insurance is a package built around professional liability, which pays when advice or work product turns out to be wrong and a client loses money because of it.

A Texas professional firm usually carries three contracts:

• Professional liability, sold as errors and omissions, for the missed filing deadline, the drawing that had to be rebuilt, the campaign that used someone else’s artwork
• General liability, for the client who trips in the lobby and the laptop a consultant knocks off a conference table
• Commercial property, for computers, servers, furniture and the tenant improvements in a leased suite

Workers compensation and commercial auto join the account once a firm has W-2 employees or a vehicle titled to the business.

Why general liability does not answer a professional mistake

General liability excludes the rendering of professional services, and that one exclusion is why a Texas consulting or engineering firm buys a second policy.

The split reads clearly in examples:

• An accountant’s client slips in the office and breaks a wrist. General liability.
• The same accountant misses a filing deadline and the client pays a penalty. Professional liability.
• An engineer’s sealed drawing specifies the wrong beam and a contractor rebuilds a floor. Professional liability, and general liability pays none of it.

Most professional liability is written on a claims-made form, which answers claims reported during the policy period rather than work performed during it. Read the retroactive date first. That date decides how far back into a firm’s past work the policy reaches.

What Aulona Insurance Group can place for a Texas professional firm

Aulona Insurance Group places professional services accounts statewide, through insurers the agency holds appointments with, so a firm can keep the whole account on one submission.

Classes the agency places: legal practices, accounting and finance, business consulting, marketing and advertising, insurance agents, administrative support, and architects and engineers.

Lines available:

• Professional liability
• General liability, standalone or inside a business owners policy
• Commercial property
• Workers compensation
• Umbrella and excess liability
• Commercial auto

Luka Cenaj, the agency’s licensed principal, goes through the services and any client contract on a recorded call before anything is quoted.

The size band the small-business program accepts

Aulona Insurance Group’s small-business program has hard eligibility limits, and a professional firm that clears them is a straightforward account to place.

Inside the band:

• Annual gross revenue under $5 million, and total W-2 payroll under $5 million
• Workers compensation runs through its own market and is not limited by the revenue and payroll figures above
• Loss history under $20,000, with no more than two incidents in the past three years
• No prior carrier cancellation and no bankruptcy filing

Billing is the number that matters most on a professional account, because the professional liability rate is built from fee income rather than from square footage. New firms are accepted with no minimum time in business, and a practice with two offices needs a business owners policy for each, capped at $5 million of total insured value per location.

Where Aulona Insurance Group is not the right fit

Aulona Insurance Group cannot place every Texas professional practice, and the profession itself decides most of it.

Professions outside the markets Aulona Insurance Group holds:

• Hospitals and physician practices, which is where medical malpractice belongs
• Any practice whose professional liability has to go to surplus lines
• A practice outside the seven classes named above, until Luka Cenaj has checked the market for it

The size band in the section above handles the rest: revenue, payroll, loss history, a prior cancellation and a bankruptcy filing. Life, health, Medicare and disability are not written at all, for any firm. A firm with a contract deadline should hear this before a week goes into paperwork.

What moves the price of a Texas professional liability policy

The premium on a Texas professional liability policy is set by the insurer, from rates it has filed with the Texas Department of Insurance, and never by Aulona Insurance Group.

Inputs on a professional services submission:

• The profession itself, because an engineering seal and a bookkeeping engagement are nothing alike to an underwriter
• Annual gross revenue, which stands in for how much work is out there to be sued over
• Claim history, where the size of a past loss matters more than the count
• The limit and deductible, and whether defense costs erode the limit or sit outside it
• The retroactive date, and whether prior acts are covered at all

Aulona Insurance Group publishes no premium and does not rank insurers. The number comes from the insurer, on a recorded call with Luka Cenaj, in English or Albanian.