Errors and omissions (E&O) insurance, also known as professional liability coverage, is a type of liability insurance that safeguards your business from claims arising due to mistakes or failures in services rendered. This insurance protects against allegations of negligence, errors, malpractice, or omissions committed while providing professional services. It covers legal expenses, damages, or settlements that may result from such claims.
Professionals such as insurance agents, doctors, lawyers, wedding planners, and financial advisors often require E&O insurance.
Not covered by E&O insurance are claims for property damage, bodily injury, workplace injuries, data breaches, intellectual property infringements, or criminal acts like fraud. The cost of E&O insurance varies based on business size and nature.
E&O insurance, or professional liability coverage, protects against claims alleging errors, mistakes in advice, or failures to meet expected service levels. It also covers disputes arising from failure to complete work, meet deadlines, or fulfill contract terms. For instance, if your IT consulting firm advises a furniture manufacturer on software upgrade, and the client later claims inadequate advice resulted in machinery malfunction and lost orders totaling $50,000, an E&O policy could cover damages and legal expenses associated with the lawsuit.
Consider obtaining E&O insurance if your business provides advice or professional services for a fee. This applies to various professionals including accountants, architects, real estate agents, consultants, and more. Some professions may require E&O insurance by law or for licensure.
When operating internationally, ensure your E&O policy offers worldwide coverage to avoid restrictions limited to incidents within the U.S. Gines Insurance Agency can help you with your E&O insurance needs. We are here to help.
