Mistakes are part of being human, but in the professional world, they can get you in trouble. As a professional, you possess a certain level of skill and expertise. Clients, patients or customers expect you to possess a certain level of competency when doing your job.
An architect should be able to design a building without structural flaws. A lawyer should provide appropriate legal counsel to his clients.
When professionals provide subpar services, they can be held responsible. If someone believes that you have committed malpractice, they can file a claim against you to recover financial losses.
Even if you never make mistakes, it’s important to educate yourself on malpractice and how you can protect yourself.
Malpractice Is Not Exclusive to Health Care
Most people associate the word “malpractice” with the health care industry. However, nearly every small business that provides a professional service can be held liable for malpractice.
A few different terms can be used to describe these mistakes:
- Errors and Omissions: Typically used in fields that require mathematical or technical skills, such as accounting.
- Malpractice: A term commonly used in the health care field, but malpractice may also describe errors made by public officials and lawyers.
- Professional Liability: The most common term used to describe professional errors.
“Lawyers, doctors and other professionals are held to higher standards of care, and rightfully so,” says law firm Gassman Legal, P.C.. “When you place your trust in a professional, the welfare of your home, your business and your family may be at stake. One careless, reckless or negligent act could be detrimental to your financial security, your health and well-being, and your entire future.”
Professionals may be held liable for a variety of mistakes, including:
- Negligence
- Breach of contract
- Violation of professional standards
- Undesired outcomes
- Error and oversight
Malpractice claims are almost always based on claims of negligence.
Types of Professional Malpractice
To get a better understanding of how malpractice can apply to nearly any professional field, let’s take a look at the most common types of malpractice.
Accounting Malpractice
Accountants may be held liable if they are negligent or careless in the preparation or review of financial documents, statements or accounts.
These professionals may be accused of being careless or negligent in:
- The preparation of a financial statement or tax return.
- The due diligence in reviewing balance sheets or profit and loss statements.
- The overstatement of net worth.
Legal Malpractice
Lawyers may face malpractice claims if they:
- Fail to follow the code of ethics when representing a client.
- Fail to file documents in a timely manner.
- Fail to appear on a client’s behalf.
- Misuse client funds.
- Are careless in the preparation or review of documents.
- Fail to obtain client consent when making a decision.
- Are negligent in the discovery phase of the case.
- There is a conflict of interest.
Engineering or Architectural Malpractice
An engineer or architect may be held liable for malpractice if he or she fails to use reasonable care in the consulting, design or advising on building projects.
Examples of malpractice may include:
- Failure to properly supervise project workers.
- Failure to follow guidelines related to structural integrity, weight loads or other building material characteristics.
- Failure to take weather or environmental factors into consideration when engineering or designing a project.
Other Types of Malpractice
- Pharmaceutical Malpractice: Pharmacists can be held liable for damages if they make prescription errors, such as providing the incorrect medication or wrong dosage.
- Broker Malpractice: Financial brokers may face malpractice claims for self-dealing or failure to disclose risk.
- Mortuary Negligence: Wrongful cremation or burial can result in a malpractice claim.
Protecting Your Business from Malpractice Claims
Fortunately, businesses can protect themselves from malpractice claims by purchasing professional liability insurance. This coverage can typically be added to any business protection plan. Some plans include this coverage as part of the standard plan.
Even if you do everything right, you can still face a malpractice claim if a client says that he or she received an undesirable outcome. And even if the claim doesn’t hold up in court, you will still need to pay for the cost of hiring a lawyer. Having the proper insurance coverage can help you avoid having to pay these fees out of pocket.
