If you run a business in Indiana that gives advice or services, professional liability insurance can protect you from costly lawsuits. Whether you’re a doctor in Bloomington, a contractor in Indianapolis, or a farm consultant in Fort Wayne, this coverage helps you stay protected.
This guide covers who needs Indiana professional liability insurance, what it includes, how much it costs, and what can happen if you ignore the rules.
WHO NEEDS THIS COVERAGE IN INDIANA
Indiana law does not require professional liability insurance for every job. But many industries still need it because of state rules or contract terms.
Healthcare Workers: To participate in the Indiana Patient Compensation Fund (PCF), healthcare providers must maintain professional liability insurance with minimum limits of $500,000 per occurrence and $1,500,000 aggregate
Healthcare providers participating in the PCF are responsible for the first $500,000, and the PCF covers damages exceeding that amount up to a total cap of $1.8 million in medical malpractice cases.
Engineers and Contractors: Must maintain general liability insurance of at least $1 million per occurrence and $2 million aggregate when working on public works projects. Design professionals typically need separate professional liability coverage of at least $1 million as required by individual contracts.
Lawyers: Not required by law, but many firms and clients ask for proof of coverage.
Agricultural Advisors: While not legally required, often purchase coverage when providing crop or soil advice that could impact client financial outcomes.
In many cases, a signed contract won’t move forward without proof of insurance. Skipping this step can lead to lost work and legal problems under Indiana business insurance regulations.
WHAT THIS COVERAGE INCLUDES
This policy is also called Indiana errors and omissions insurance. It protects your business if a client claims that you made a mistake, gave poor advice, or failed to deliver a service.
Typical coverage includes:
Legal Costs: Covers your defense in court and any settlement.
Work Mistakes: Protects you if an engineer’s error causes delays or losses.
Breach of Contract: Covers claims if you fail to meet terms listed in a signed agreement.
Medical Add-Ons: Healthcare providers can access additional coverage through the PCF, which provides up to $1.3 million in excess coverage above the provider’s $500,000 primary coverage, for a total maximum recovery of $1.8 million.
Many professionals confuse liability policies with workers’ comp. Our guide on whether workers’ compensation is the same as liability insurance explains the differences and why both may be essential.
COMMON RISKS AND CLAIMS
Professional liability claims can affect any business providing services or advice. Many are due to errors that could have been avoided. Here are a few examples:
Construction Inspector: Misses a major issue that leads to damage. The property owner files a claim.
Accountant: Submits the wrong tax info, causing penalties. The client sues to recover losses.
Marketing Consultant: Doesn’t meet promised results. The client says they lost money.
Real Estate Appraiser: Lists a home’s value too high. After the sale, the lender takes legal action.
COST FACTORS OF COVERAGE IN INDIANA
The cost of insurance depends on your job, company size, and past claims. Your location and contract requirements also affect your rate. Indiana business insurance regulations also influence pricing.
Costs go up if:
- You work on large public jobs
- You’ve had claims in the last five years
- You choose higher limits or lower deductibles
- You operate in busy legal areas
- You’ve failed past state audits
CLAIMS PROCESS AND LEGAL RULES
If something goes wrong, take action right away. Indiana’s statute of limitations is usually two years after the incident. Here’s how the process works:
- Report the issue to your insurer—even if no one has filed a lawsuit yet.
- The insurer investigates the facts and talks to people involved.
- If needed, they assign a lawyer and offer mediation first.
- If mediation fails, your policy will help cover defense costs in court.
WHAT HAPPENS IF YOU IGNORE THE RULES
If you skip coverage or don’t meet state standards, it can cost you. Specific penalties vary by profession and type of violation. You could face licensing issues, contract disputes, and personal liability if you break professional requirements.
FINAL TAKEAWAYS FOR INDIANA BUSINESS OWNERS
No matter your industry, Indiana professional liability insurance protects your business and your reputation. From doctors and lawyers to engineers and consultants, this policy helps you stay open and stay legal.
Here’s what to do next:
- Review contracts for any required coverage
- Review any specific insurance requirements for your profession and contracts.
- Combine your general liability and E&O policies to save money
Need help choosing the right plan? Call us at (855) 718-7552
