General liability and professional liability are two of the most common business insurance policies, and they are easy to confuse. They cover very different kinds of risk, and a claim that one policy responds to is often excluded by the other. Understanding the distinction helps you avoid a costly gap in your protection.
General liability (GL) generally responds to third-party bodily injury and property damage caused by your business operations, premises, or products. Common examples include a customer slipping in your office or your work accidentally damaging someone else's property.
GL also typically covers certain personal and advertising injury claims, such as libel, slander, or copyright issues in your advertising. It is broad foundational coverage that most businesses carry regardless of industry.
Professional liability, often called errors and omissions (E&O), generally responds to financial harm a client suffers because of your professional advice, services, or work. Rather than physical injury or damage, it addresses claims of negligence, mistakes, missed deadlines, or failure to deliver as promised.
This coverage is especially relevant for businesses whose product is essentially their expertise, such as consultants, accountants, designers, technology firms, and other service providers. A claim might allege that an error in your work caused a client to lose money.
The core distinction is the type of harm. GL typically addresses physical injury and property damage, while E&O typically addresses purely economic loss tied to professional performance. A GL policy generally excludes claims arising from professional services, and an E&O policy generally excludes bodily injury and property damage.
Because of this, relying on only one policy can leave a meaningful gap. A design firm with only GL, for example, would generally have no coverage for a client lawsuit alleging that a flawed plan caused financial loss.
Nearly any business can face a slip-and-fall or property damage claim, so GL is widely carried. Businesses that give advice, provide professional services, or are paid for their judgment also face the risk of an unhappy client alleging a mistake, which points toward E&O.
Many service businesses ultimately need both because their exposures overlap. They have a physical presence and interact with the public (a GL exposure) while also delivering professional work that a client could challenge (an E&O exposure).
E&O policies are frequently written on a claims-made basis, meaning the policy generally must be in force both when the work was done and when the claim is reported. This differs from many GL policies, which are often written on an occurrence basis covering incidents that happen during the policy period regardless of when the claim is filed.
Because of this structure, gaps in claims-made coverage can be risky, and features like prior acts coverage or an extended reporting period (sometimes called tail coverage) are worth discussing with your agent before you change or cancel a policy.
Generally no. GL typically responds to bodily injury and property damage, and usually excludes claims arising from your professional services. Those are typically addressed by an E&O policy.
Often yes. E&O generally does not cover bodily injury or property damage, so a customer injury or accidental property damage claim would typically fall outside of it. Many businesses carry both.
It generally means the policy must be active both when the work occurred and when the claim is reported. This makes continuity of coverage important, and tail or prior acts options are worth reviewing with your agent.
These guides are a starting point — your business is unique. Talk to an advisor who can look at your actual exposures and structure coverage around them.