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3 things to know about professional negligence claims

Owning a business in Austin, like any other area, comes with a certain amount of risk. For instance, imagine you saved money for years to start your own accounting practice. The first few years of owning your own practice may be hard and require long hours with little profit. The risk you took by investing most of your savings may seem like it might not pay off. However, after a few more years, your business is thriving and you have even had to expand your office to accommodate additional staff. You might begin to feel more secure and that risks and threats to your practice are almost non-existent.

Unfortunately, one threat that will remain for the entire time you operate your business is a professional negligence lawsuit. These types of lawsuits are becoming more commonplace across Texas as well as the rest of the country. If you own a business, here is what you should know about professional negligence claims.

Financial loss

A negligence claim can cost a business thousands of dollars depending on the circumstances involved. For example, if the client records in your accounting practice are not sufficiently protected and there is a data breach that leaks sensitive data such as names, social security numbers and bank account information, you could face a lawsuit from multiple clients. This could be enough to put you out of business and it might even cost you your professional license. While insurance might be able to mitigate the losses, it still may be too much to fully recover from.

Reputation loss

In addition to the financial costs, a negligence claim might also cost you your professional reputation. Since lawsuits are often a matter of public record, it is possible that a news outlet will report the claim of negligence against your company. In addition, social media could pick up the story and reach even more people, costing you current and future clients.


There are various measures you can take to prevent a negligence claim against your business. First, be sure the premises are up to health and safety codes to reasonably avoid any on-site injuries. Second, be sure your security measures are always up to date and functioning correctly. Take the time to train your employees in proper procedures for handling sensitive client data and other safety protocols. Also, cultivate a friendly workplace atmosphere so that employees feel comfortable alerting you to issues or concerns or even asking questions.

While there are several things you can do to mitigate the threat of a professional negligence claim against your business, it may be impossible to protect against every lawsuit. If your company is facing a professional negligence lawsuit, you have the right to defend against it.

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