Errors and Omissions Insurance is simply referred to as E & O. It is the insurance policy of professional liability insurance that covers a business and professional against claims of negligence or failure to perform professional duties.
Errors and omissions cover all types of malpractice insurance.
An errors and omissions policy covers related court costs and any settlements up to a specified amount.
Who Needs Errors and Omissions Insurance
E&O insurance is an insurance policy that is designed for doctors, lawyers, and financial professionals, like financial planners, investment strategists and advisors, and insurance brokers.
They make decisions every day that can impact the physical and financial safety and wellbeing of their clientele.
Lawsuits are common in most of these industries, regardless of how baseless the claims may be. For example, even if a financial professional spells out the risks involved in an investment, if that investment goes wrong, there’s a chance the client will sue. Even if the case works out in the favor of the professional, the costs are astronomical.
It is the same case in the medical world. We are, after all, only humans and we make mistakes.
If you’re in an industry in which your daily duties can and do impact the financial and physical lives of your clients, errors and omissions insurance is important for you.
E&O Coverage Examples
Errors and omissions insurance covers a lot of areas. Here are a few:
Whether actual or alleged, professional negligence may take down even the strongest companies. E&O insurance is recommended to protect companies against claims of any negligence, which include providing incorrect information or making a mistake.
Although it is not the same as bodily injury or property damage, personal injury will be able to protect you and your business against claims of slander or libel due to the result of your professional work.
Errors and omissions insurance can be customized to fit your specific business, so you must cover any event of copyright infringement.
One of the greatest benefits of E&O insurance is that it is designed to cover court costs and legal fees if you are sued. In some cases, if there are no solid grounds for a lawsuit, the insurance policy can still protect you.
Some policies help to pay supplemental expenses incurred as a result of a trial or arbitrations, such as travel.