Professional Liability Insurance in Arizona

NEXT is the best professional liability insurance provider in Arizona, with a MoneyGeek score of 98 out of 100 for its exceptional customer service and affordable rates. However, consider The Hartford, Nationwide, Hiscox, and biBerk when exploring your insurance options.

*Rates presented for LLCs refer to a software development company with 20 employees, $5 million in annual revenue and $1,250,000 in annual payroll costs. Sole proprietor rates assume a business with no payroll expenses and $500,000 in annual revenue.

The average costs for professional liability insurance are approximately $1,145 per year for sole proprietors and $6,940 for LLCs. However, depending on your chosen company, rates can be anywhere from $527 to $22,055 annually.

*Rates presented for LLCs refer to a software development company with 20 employees, $5 million in annual revenue and $1,250,000 in annual payroll costs. Sole proprietor rates assume a business with no payroll expenses and $500,000 in annual revenue.

Professional liability insurance costs vary based on several factors:

Professional liability insurance can be confusing to new business owners. Here's what it covers, who needs it and how to find affordable coverage in Arizona.

Professional liability insurance, or malpractice insurance, helps cover damages and legal expenses while providing services to a client. It comes in two types: claims-made, which covers incidents reported during the policy period, and occurrence-based, which covers incidents regardless of when claims are filed.

Professional liability insurance is mandatory only in certain cases, like when required by a client, state law or for a business license. However, businesses in high-risk professions should consider coverage due to the nature of their services. Here are professions that often require or benefit from this insurance:

• Accountants and tax preparers
• Lawyers
• Architects
• Real estate agents
• Consultants
• Financial advisors
• IT professionals
• Health care providers
• Marketing and advertising professionals
• Graphic designers
• Insurance professionals
• Interior designers
• Construction contractors

Here are easy steps to help you find the best professional liability insurance for your needs in Arizona:

Arizona's top professional liability insurance providers are NEXT, The Hartford and Nationwide. While these are strong options, compare providers yourself, decide on coverage needs first and research each company's offerings before buying.

Below are frequently asked questions about professional liability insurance in Arizona:

MoneyGeek created a scoring system to compare business insurance companies across six metrics and ranked them based on their scores for Arizona. We chose these companies based on their broad national coverage and ability to provide an online quote.

Small Business Sample Profiles:

We gathered quotes for two types of software development companies in Arizona:

• An LLC with five years in business, 20 employees, $5 million in annual revenue and $1,250,000 in annual payroll costs.
• A sole proprietorship with five years in business, no employees, $500,000 in annual revenue and no payroll costs.

MoneyGeek’s Scoring System:

In our unique scoring system, companies can earn up to five points in each of the six categories. We then use these category scores to calculate an overall MoneyGeek score out of 100. We applied the following weightings to score insurers:

• Affordability for LLCs: 55%
• Affordability for sole proprietors: 5%
• Customer satisfaction: 25%
• Financial stability: 5%
• Coverages offered: 5%
• Online quote process: 5%

Each company’s score incorporates:

• Customer satisfaction data from the National Association of Insurance Commissioners (NAIC) customer complaint index (we reviewed annual complaint data from 2020 to 2022, the most recent year available)
• Financial strength ratings from AM Best
• Cost data obtained through online quotes, based on the monthly and yearly cost of a professional liability policy with a $1 million per occurrence limit, $1 million aggregate limit and $5,000 deductible
• How many minutes it took to complete an online application and receive a quote from each company
• The variety of each company’s coverage offerings and the number of core business insurance coverage options available to customers

Quote Gathering Process

Three companies on our list — NEXT, The Hartford and Thimble — require business owners to bundle professional liability insurance with general liability coverage when obtaining an online quote. Thimble also includes cyber liability insurance in its bundle.

For these three companies, we gathered bundled quotes and quotes for general liability insurance. We then subtracted the cost of general liability insurance from the bundled amount to determine the cost of professional liability coverage on its own.