Professional Liability Jeopardy

Professional Liability Basics

100

Coverage triggered by failure of expertise - not accidents 

Professional liability 

200

Professional liability is primarily divided into these two categories based on type of risk exposure.

Medical malpractice and E&O

300

This factor determines how professional liability risks are categorized across industries 

Type of service provided (healthcare vs professional services) 

400

This concept explains why different professions require different liability coverage structures 

Variation in risk exposure 

500

This policy structure determines whether coverage is triggered based on when the claim is made versus when the incident occurred

claims-made vs occurrence coverage 

Medical Malpractice

100

Liability involving bodily harm from treatment - not advice 

Medical Malpractice 

200

Malpractice claims are distinguished from E&O by involving this type of damage

Physical Injury

300

This type of claim involves a failure to diagnose or properly treat a patient 

Malpractice/negligence 

400

This claim characteristic makes malpractice one of the most costly insurance segments

High claim severity 

500

Dr. Smith is an OBGYN with a claims-made policy (retroactive date: 1/1/21). She delivers a baby in March 2023; the baby suffers a birth injury. In August of 2025, Dr. Smith Retires and cancels her policy WITHOUT purchasing tail coverage. In January 2026, the family filed a lawsuit. Dr. Smith’s new insurer has a retroactive date of September 2025. Which policy (if any) covers this claim?

No policy will respond, because the claim was made after the original policy ended and before the new policy’s retroactive date.

E&O

100

Liability involving economic loss without physical injury 

Erros and Omissions 

200

E&O claims primarily involve this type of harm 

Financial loss

300

This type of professional mistake in E&O involves failing to meet a standard of care when providing advice or services, resulting in financial loss.

Negligence in providing professional services 

400

Compared to malpractice, E&O claims typically follow this pattern 

High frequency and low severity 

500

This coverage requirement means a claim must be reported during the active policy period, often creating the need for tail coverage upon cancellation 

Claims-made coverage 

Key Differences

100

This fundamental distinction separates malpractice form E&O claims 

Physical harm vs financial loss

200

This category has higher claim severity due to the nature of damages involved 

Medical Malpractice

300

This difference explains why one segment produces many smaller claims while the other produces fewer but larger ones.

Frequency vs severity

400

This factor makes on segment more heavily regulated due to direct impact on human health

Physical harm 

500

This legal and structural difference explains why malpractice claims often take longer to resolve and involve more complex litigation than E&O claims 

The involvement of bodily injury and medical standards of care

Market and Global Trends

100

This trend refers to increasing claim costs due to larger settlements and jury awards 

Rising claim severity 

200

This trend reflects the growing number and complexity of lawsuits 

Increased litigation 

300

This emerging exposure is increasing risk in professional liability due to digital reliance 

Cyber risk 

400

This healthcare-related issue is increasing malpractice risk globally 

Staffing shortages and burnout 

500

This broad industry trend reflects increasing claim severity driven by larger settlements, rising litigation costs, and more complex legal environements. 

Rising claim severity