In today's litigious world, it is very possible to be sued. Chances are your more likely to be sued if you are in a profession that gives advice, makes suggestions, market and sells something or designs & builds something.
Professionals in these sectors need Errors & Omissions Insurance in their files on day one, not to mention the leverage one will have looking for a new job who has an E & O policy in their back pocket.
- Insurance Agents
- Independent Contractors
- Sales Representatives
- Financial Advisors
Bottom line, anyone or business who offers service or advice for a cost, can be sued. People these days will accuse you in a heart beat that you did not fulfill your contract, obligation, poorly built a structure, gave bad advise, did not disclose something, did not state terms or conditions, over sold, under delivered, Lied, made errors or omitted something and the list goes on.
It does not take much for someone to drag you in to court to challenge your reputation, business and all you own, including the financial burden to defend yourself.
So What Does Errors & Omissions Insurance Cover?
- Errors Made
- Omitting information
- Not disclosing
- Breaking laws
- Negligent acts,
- Copyright infringement
- Bad legal or financial advice
- Personal injury
- Court costs
- Punitive damages.
Typically insurance company's offering Errors & Omissions Insurance offer their own underwritten coverage that may not be offered elsewhere.
Errors & Omissions Insurance will not cover:
- Criminal Acts
- False advertising,
- Bodily injury and/or property damage,
- Employer’ liability claims, such as sexual harassment or child molestation,
- Workers’ compensation claims, and
- Patents and trade secrets.
Understanding Limit Options With Your Errors & Omissions Insurance
When you purchase Errors & Omissions Insurance, it is important to understand what coverage your getting in return for your Purchase.
Occurrence limit – The maximum that your E&O Policy will pay out for any claim made against your Policy from one event.
·Aggregate limit – This is the maximum your insurance Policy will pay in total during the life of the Policy.
A typical auto Policy has limits of $100,000/$300,000, An Errors & Omissions Policy limits are figured out the same way. The typical E&O policy limit will be for example:
Occurrence/Aggregate – $1,000,000/$2,000,000.