The Basics of Errors and Omissions Insurance

What is E&O insurance? Simply put, it is a slightly specializes type of professional liability insurance. It focuses on claims relating to failing to provide or providing a service. Specifically if a company or individuals are sued for negligent actions or inadequate work, the liability will cover legal fees, which can easily amount to hundreds of thousands of dollars. Even if the defendants are vindicated, court and legal expenses can be crippling without E&O coverage.

Who Needs E&O Coverage?

Almost all working professionals who provide service can make use of E&O insurance. This includes:
  • Insurance Brokers and Agents
  • Medical Personnel
  • Financial Planners
  • Legal Professionals
  • Real Estate Agents
Anyone who has employees or gives a direct service to clients should have this type of insurance. In these fields, it is likely that a slight miscalculation could hinder an entire project or account. Though it may be an honest mistake, it still may incite a lawsuit.

Why Is Coverage Necessary?

No matter how well a business is run, mistakes will happen. Especially if an enterprise has a large number of employees, it is likely that someone will make an error. While the insurance does not cover intentional oversight, it will protect against those unpredictable accidents. What is E&O insurance? It is a safeguard against possible mistakes and legal fees. Lawsuits and malpractice claims can wipe out a business, even if they are proven false. E&O offers a safety net for vulnerable enterprises.

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