Two Crucial Commercial Policies Explained

If you are looking into acquiring business insurance or hoping to expand your coverage then you have likely heard about directors and officers (D&O) insurance. You may have heard about errors and omissions insurance (E&O). Upon first glance, these two policies may sound pretty similar. However, the difference between D&O and E&O insurance lies within the fine details.

Who They Cover?

As the name, directors, and officers, would suggest, D&O is built specifically for the high executives of a business. This can include corporate teams and committees. Meanwhile, errors and omissions come into play for employees, companies themselves and even subcontractors. Both policies do not protect anyone who commits an illegal activity.

What Do They Help With?

Directors and officers insurance is helpful when a higher executive is accused of misrepresentation, misuse of funds, theft of intellectual property or failure to disclose conflict of interest. Meanwhile, errors and omissions protect an employee in case they face a claim of negligent service or poor work.
These key differences make it clear that these policies are two separate entities. It is recommended that any type of business acquire both of these protections. Now that you the difference between D&O and E&O insurance, you are better prepared to build your coverage alongside a qualified insurer.