INSURANCE AS STRATEGY FOR MANAGING PROFESSIONAL LIABILITY RISK.

Professional liability insurance is designed for businesses that sell their expertise, such as accountants, financial consultants, lawyers, engineers, architects. This type of insurance protects businesses and individuals who provide professional services to clients from the legal costs or for the damages that may arise form an act, omission or breach of duty in course of their business. Professional liability insurance is safety net for business mistake such as failure to deliver work product the clients expect and for which they paid. On the insurance market in Republic of Macedonia are offered almost all type of products related to professional liability offered in the neighboring countries and in EU. The participation of this type of insurance in Gross Written Premium is increasing as well as the number of sold policies. But is this increase due to awareness of the businesses for the advantages of having professional liability insurance or it is related to legal obligation for buying this insurance in order to comply with legal requirements or acquire license/permit for certain profession. The purpose of this paper is to analyze whether and to which extent the professional liability insurance is used as efficient strategy for offsetting the consequences and losses arising from professional liability risk. [ABSTRACT FROM AUTHOR]