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What Is Errors and Omissions Insurance Coverage?
What does errors and omissions insurance cover? Errors and omissions insurance, also known as E&O insurance or professional liability insurance, helps protect you and your company if someone claims you made a mistake in the professional services you’ve provided. This coverage can help pay for costs if a customer or client files a claim against your small business.
What Does E&O Insurance Cover?
No matter how hard you try to avoid them, mistakes can happen. When they do, your customers can sue your business for:
- Negligence
- Error
- Omissions
- Misrepresentation
- Violation of good faith and fair dealing
- Inaccurate advice
- Personal injury claims, like libel or slander
- Mistakes made by temporary staff and contractors
One example of an errors and omissions claim is an accountant giving a client bad advice, which makes them suffer a large financial loss. As a result, the client sues the business owner of the accounting firm for negligence. Errors and omissions coverage can help pay for:
- Damages, including any judgments and settlements that result from the lawsuit.
- Court costs, which can include legal defense costs, attorney fees and other court-related expenses.
- Disciplinary proceedings called by a regulatory, licensing or other government agency.
- Loss of earnings due to the time you spend at depositions and trials.
- Subpoena assistance if you’re a witness in a lawsuit.
Another benefit of getting your E&O policy from us is that you’ll have coverage across the U.S. and Canada.
Who Needs Errors and Omissions Insurance Coverage?
Not sure who needs errors and omissions insurance? Some states and licensing boards require certain businesses to have this coverage. Even if it’s not required, you should consider including E&O coverage in your risk management plan if you work with customers.
Some businesses that can benefit from this insurance include:
E&O insurance helps cover small businesses owners and their employees if they provide professional services or give advice to their clients. Without this coverage, the cost of liability claims could financially devastate your business.
How Is E&O Insurance Different From General Business Insurance?
Every type of business insurance covers different kinds of claims. The same is true with E&O insurance and general liability insurance. An E&O insurance policy helps cover claims where your business made a mistake in the professional services given. If someone claims your business hurt them or damaged their property, E&O coverage wouldn’t help you. You’d need general liability insurance instead.
General liability coverage helps cover claims where your business caused bodily injury or property damage to others. It’s an essential type of insurance that most small business owners need.
Get more answers to errors and omissions insurance frequently asked questions.
What Errors and Omissions Insurance Doesn’t Cover
E&O insurance protects your business against many risks and lawsuits, but it doesn’t cover everything. It won’t help if you get sued for:
- Employment practices, such as wrongful termination or harassment. You’ll need employment practices liability insurance to help cover these claims.
- Illegal acts or purposeful wrongdoing, including dishonest behavior or fraudulent actions.
- Patents and trade secrets taken without permission. Your general liability insurance policy may protect you if you’re sued for stealing intellectual property.
- Bodily injury or property damage caused by your business. If your customer falls and gets hurt in your office or your employee damages your client’s property, you’ll need general liability insurance.
- Work-related injuries or illnesses to your employees. Your workers' compensation insurance can help cover these.
- Lost or stolen personally identifiable information that your business collects. Data breach insurance can help cover your costs to notify impacted clients.
How Do I Get E&O Coverage?
We’re an insurance company that makes it easy for you to get E&O coverage by getting a professional liability insurance quote online. With our online quoting tool, getting a quote is simple and only takes a few minutes. You’ll need this information to start the quoting process:
- Your contact information
- The number of employees working for your business
- Your estimated business revenue for the upcoming year
- Information on what work your business does and its risks
- Your business’ location
- Details about your business premises
- Documentation on how long you’ve owned your business
If you’re wondering about errors and omissions insurance costs, there’s not an easy answer. Every small business is different. Getting a quote is the best way to find out how much E&O coverage will cost you.
Errors and Omissions Coverage Frequently Asked Questions
How Much Is E&O Typically?
The cost of your E&O insurance varies depending on a variety of factors, like your:
- Business size
- Revenue
- Industria
- Employee training
- Contratos
- Lugar
- Claims history
- Límites de la cobertura
Is Errors and Omissions Insurance Required?
Certain states do require E&O coverage. However, even if it’s not required by your state, it’s still a good idea to get this coverage. Without this policy, you could have to pay for claims out of pocket.
What Type of E and O Insurance Should I Buy?
E&O insurance policies vary from company to company and can cover different risks. Typically, these policies help pay legal defense costs and attorneys’ fees if you’re sued for:
- Negligence
- Errors or omissions in the services provided
- Misrepresentation
- Inaccurate advice
- Violation of good faith or fair dealing