Errors and Omissions Insurance
Also known as E & O or Professional Insurance, Errors and Omissions Insurance is a liability insurance, similar to medical malpractice insurance. This type of insurance policy offers coverage for your business against potential liability claims. The insurance comes in handy when you offer services to a client, who then sues you against those services or claims that you failed to provide services properly, which caused an omission for them – perceived to be your fault. Put another way, it covers you when someone relies on your advice or professional knowledge.
Errors and Omissions Insurance covers attorney fees, cost of judgments and settlements. Since a standard business owners liability policy does not cover errors and omission claims, you need to purchase a separate policy for this type of coverage.
Who needs Errors and Omissions Insurance?
Businesses in the sales, design, service, or consultation industries, such as advertising, web design, real estate, home inspection, finance, event planning, have a high potential for such claims. Engineering, law, accounting, medicine, chiropractic professionals experience these claims on a regular basis.
Purchasing Errors and Omissions Insurance
Errors and Omissions Insurance offers peace of mind and protects your business from being in a financial bind. Any professional service provider or business can be sued for accusations of negligence or failure to perform duties properly, even if it has made no mistake.
Consider Errors and Omissions Insurance if your business:
- regularly offers consultations or provides advice and expertise to a client
- provides a professional service
- is required by clients to have such type of insurance
Errors and Omissions insurance coverage is an essential part of protecting your business.