What type of insurance covers claims made for professional mistakes?

Professional liability insurance, often referred to as errors and omissions (E&O) insurance, is specifically designed to cover claims arising from professional mistakes or negligence. This type of insurance is particularly important for professionals who provide advice or services, such as doctors, lawyers, accountants, and consultants. It protects against claims from clients who allege that the professional's work was inadequate, which resulted in a financial loss for the client.

Professional liability insurance covers legal costs, settlements, and judgments that may arise from lawsuits due to alleged errors or omissions in the professional services provided. This coverage is crucial, as even well-intentioned professionals can make mistakes that lead to client dissatisfaction or financial harm.

In contrast, the other options address different aspects of insurance. Property insurance covers damage to or loss of physical assets, general liability insurance protects against claims of bodily injury or property damage arising from business operations, and workers' compensation insurance provides benefits to employees who suffer work-related injuries or illnesses. None of these types of insurance specifically address claims related to professional errors or negligence, making professional liability insurance the correct choice for this question.