a professional services contract is the agreement used when hiring an independent contractor to perform a specialized, project-based service.3 min read a professional services contract is the agreement used when hiring an independent contractor to perform a specialized, project-based service. if you act as a consultant, professional liability insurance covers the costs if a client sues you for damages caused by negligence. some contract promises are considered uninsurable, which means they aren’t covered by this type of insurance policy. although perfection is desirable, it isn’t necessarily realistic and using this language can lead to potential disputes and insurability problems. this standard is applied even when it is not delineated in the contract.