Important to Know

Always have a written contract that spells out what will be done, what will not be done and what the fees will be. Communicate throughout the job and keep the expectations realistic. Have quality control procedures in place and use internal and external audits to check them.

Negligence and misrepresentation claims that fall under professional liability are very broad in spectrum. Any situation that involves an individual or corporation breaching its duty and causing injury and/or financial loss can be considered negligence.

Sometimes it can be as simple as miscommunicated results, a missed deadline, a misinterpretation of a law, or an error in paperwork. Malpractice allegations can also arise from changes in your clients that are out of your control. In fact, even if you’ve done the work to spec without mistakes, you can still be sued if your work doesn’t meet a client’s personal standards or expectations. A woman sued a financial planning firm for $3 million after following their advice to quit her job, start a home business and transfer her savings into their pension plan.