General liability and professional liability insurance get confused constantly, partly because both show up on the same 'business insurance' shopping list, and partly because the names sound interchangeable. They cover almost entirely different risks.
| Policy | What It Covers | What It Doesn't Cover |
|---|---|---|
| General Liability | Customer injuries, property damage | Financial loss from your advice |
| Professional Liability (E&O) | Financial loss from your work | Physical injuries, property damage |
General Liability
General liability covers third-party bodily injury and property damage - a customer slipping in your store, or your crew damaging a client's property on a job site. It's the baseline policy almost every business needs, often required by landlords or contracts before you can even sign a lease.
Professional Liability (E&O)
Professional liability, also called errors & omissions (E&O), covers claims that your advice, service, or work product caused a financial loss - a missed deadline, a design flaw, a bad recommendation. It doesn't respond to a physical injury claim, and general liability doesn't respond to a financial-loss claim.
If your business gives advice, designs something, or delivers a service where a mistake could cost a client money rather than cause physical harm, you likely need both policies. A graphic designer, accountant, or consultant in Wake Forest or anywhere in North Carolina is exposed without E&O coverage even if general liability is in place. The NC Department of Insurance provides guidance on coverage requirements for North Carolina businesses. Explore business insurance options or talk to an IronHaven agent about the right combination for your work.
