The short version: general liability covers physical harm. Professional liability covers financial harm. If nobody was hurt and nothing was broken, but your client lost money because of something you advised, designed, or performed, general liability was never going to respond.

What each one actually does

Commercial general liability covers bodily injury, property damage, and personal and advertising injury caused by your premises, your operations, or your products. Someone trips in your lobby. Your crew backs a truck into a storefront. Your product fails and injures a user.

Professional liability — also called errors and omissions — covers a negligent act, error, or omission in the professional services you provide, where the result is a financial loss to your client. No blood, no broken glass, just money the client did not get back.

The test that settles most arguments

Ask what the client is actually suing over:

  • Someone got hurt, or something got broken → general liability
  • Someone lost money because of your judgment or your work product → professional liability

Two claims from the same company

An IT consulting firm has both policies. In March, a technician wheeling a server rack drops it on a client employee's foot. That is bodily injury from operations — general liability.

In June, the same firm misconfigures a client's firewall. Three weeks later the client is breached, loses eleven days of production, and sues for $400,000. Nobody was injured and no property was physically damaged. General liability has nothing to respond with. That is squarely a professional liability claim.

The exclusion most owners have never read

This is the part that matters most. Many CGL policies carry a professional services exclusion, added by endorsement for classes where the carrier knows the exposure exists — consultants, designers, medical and allied health, beauty and wellness, inspectors, staffing firms. It does not merely fail to cover professional services. It affirmatively excludes them, including the duty to defend. Your general liability carrier will not even pay the lawyer.

Claims-made changes how you buy it

Most professional liability is written on a claims-made basis, which works differently from the occurrence form on your GL:

  • The policy responds to claims first made during the policy period, not to work performed during it
  • A retroactive date sets how far back your prior work is picked up — losing that date when you switch carriers can wipe out coverage for years of completed work
  • When you cancel or retire, prior work is only protected if you buy an extended reporting period, usually called tail coverage

So the day you switch professional liability carriers is a day to look closely at the retro date, not just the premium.

Who should assume they need it

Anyone paid for judgment, advice, design, or a deliverable: consultants, IT and managed services, engineers and architects, accountants and bookkeepers, real estate and property managers, staffing and recruiting, marketing agencies, inspectors, medical and allied health, and — increasingly — contractors working under design-build or design-assist contracts.

Related: Contractors professional liability · Tail coverage explained

Educational only — confirm against the actual policy form and endorsements.