Choosing the Right EO Policy for Your Business

Errors and omissions insurance, know simply as E&O coverage, helps protect your business against certain claims made by clients or customers. Let’s look at the benefits and types of coverage available.

What Does E&O Insurance Cover?

E&O insurance will protect you when a client files a claim against your company due to negligence or providing errant information. Legal fees in these situations are very costly without proper coverage. Also known as professional liability insurance, this insurance is especially critical to a business that provides professional services or offers advice to clients. Lawyers, accountants, engineers and consultants are some of the key professional groups that are especially prone to errors and omissions liability.

E&O policies vary, so choose one that best meets your particular needs and circumstances. Coverage may include such items as:

  • Negligence – This is the most common type of coverage. It protects against alleged mistakes, failure to fulfill a promise or incorrect advice.
  • Copyright infringement – Expenses or damages resulting from copyright issues are covered under this plan.
  • Legal costs – Coverage will include legal defense if a claim is filed.

Make sure you are covered against unwanted claims from clients and customers. Talk with your insurance agent to see which type of coverage is best for your business.

Professional Liability Insurance for Almost Any Business

Errors and omissions policies are a backbone form of coverage for many professionals, especially those in high trust positions like doctors, lawyers, and financial professionals. They’re hardly the only ones who could benefit from professional liability insurance, though. Most of the time, if a professional is acting as a freelancer or one-person business, some form of E&O coverage for their professional liabilities will wind up being a good idea. From IT contractors to auto repair professionals, each skilled career has its own unique risks associated with professional misjudgment or accidental oversight, and miscellaneous errors and omissions insurance programs exist to provide individualized coverage for those businesses.

Assessing Professional Risks for Yourself

Most of the time, if you aren’t in practice on your own or working freelance, your employer assumes the risk for your professional decisions on behalf of a company. There are some cases where this isn’t true, but largely it is, and as a result many people have very little experience with professional liability coverage. As the workforce becomes more and more dependent with fewer and fewer industries relying on wage labor, that landscape is changing, and diverse E&O programs have become very high-demand. If your current coverage doesn’t include professional liability, now is the time for an insurance review with an eye toward adding the policy. Luckily, there are providers with over a quarter of a century of experience with miscellaneous E&O coverage, so it won’t be hard to find a provider.