$5M Professional Liability (E&O) Insurance for PR Firms

For PR firms whose client contract requires $5M: it is usually met with one primary policy, or a primary policy plus an excess policy (extra coverage on top).

What does a $5M requirement mean for PR firms?

Professional Liability (E&O, short for Errors and Omissions) can help when a client says your work cost them money. PR firms usually buy a policy that includes media liability, which covers claims over copyright (using someone's work), trademark (a brand name or logo), defamation (false statements that harm a reputation) and privacy in content you create. A $5M clause may read like this:

• Per claim and aggregate: the most paid for one claim, and for all claims in a year.
• Claims-made: Professional Liability is almost always written this way: it covers claims made and reported while active. The retroactive date is the earliest work date covered. See retroactive dates.
• Media liability: press releases, pitches and social posts can lead to these claims, so check that your policy includes it.
• Primary plus excess: if the clause does not mention layers, confirm with the client that primary plus follow-form excess meets it.

Who asks PR firms for $5M?

Large corporate and regulated clients usually ask for $5M, because their exposure is bigger than your firm's size suggests. Examples:

• Public companies, where a wrong statement could move a stock price
• Financial services, insurance and healthcare brands
• Large agencies that pass their own client's requirement down to you in a master services agreement (the main contract between you and the agency)
• Government and public affairs work

Many contracts ask for $3M or $2M instead. $5M tends to come from clients with more at stake.

How is $5M built?

$5M is usually one primary policy or a primary plus excess layers. A primary policy pays first. An excess policy pays only after the primary limit is used up. "$3M xs $2M" means a $3M layer above the first $2M.

Ideally, every layer shares the same retroactive date, policy period and named insured (the business the policy covers).

Many Professional Liability policies pay defense costs inside the limit, so legal fees can shrink what is left for a settlement (see defense costs inside vs. outside limits). A commercial umbrella (extra liability coverage on top of policies like general liability) almost never covers Professional Liability, so it usually cannot fill an excess layer.

What will underwriters ask for?

Underwriters, who decide whether to offer coverage, usually focus on your services and how you check content. Expect questions like these:

• Your service mix: media relations, crisis communications, investor relations, influencers and events
• How you check facts and client claims before a release goes out, and who signs off
• How you clear images, music and other content you did not create
• How you manage influencers and freelancers in writing
• Your client industries and revenue by service
• Loss runs (a report of past claims) and your current retroactive date

What affects the cost?

Your services, clients, claims history and structure matter most.

• Your services and clients. Investor relations and crisis work for regulated clients may cost more than routine media outreach.
• How the $5M is built. Each layer is priced on its own, so one $5M policy and a stack of layers can cost different amounts.
• Claims history. Past claims can narrow the limit offered and raise prices.
• Retention and defense terms. Retention works like a deductible, and a higher one often lowers premium. Defense outside the limit often costs more.

Frequently asked questions

Do I need $5M Professional Liability (E&O) as a PR firm?

Only if your contract or client requires it. Large corporate and regulated clients most often do, so read the insurance clause first.

Can a small PR firm get $5M in Professional Liability?

Sometimes. It depends on revenue, services, client mix and claims history, and many small firms are offered less. It is usually a primary policy plus excess, and excess markets may require a minimum primary limit. $5M almost always needs a broker. Morrow can help you find it.

Can my client be added as an additional insured on my PR firm's policy?

Usually not. Additional insured status (extra protection for the client under your policy) is generally not available on Professional Liability. In rare cases a carrier may add a client when a written contract requires it. Ask when quotes are requested, and check that each excess layer follows the same wording. Some clients may accept a certificate of insurance (a one-page summary proving your coverage) listing every layer. Check your contract.

I have a $2M policy and my contract says $5M. What can I do?

Ask Morrow to request new quotes, either a new primary policy at $5M or a primary plus excess structure, and to keep your retroactive date and prior acts coverage (coverage for work done before the new policy starts) where the market allows. Report anything that could become a claim to your current carrier before you switch.

This article is general information, not legal advice or a coverage determination. Coverage depends on the actual policy wording, carrier underwriting and your contract terms.