What is Professional Liability (E&O) Coverage?
While General Liability coverage protects against claims of property damage or bodily injury, Professional Liability (also referred to as Errors & Omissions) protects specifically against claims of economic damage arising from the performance of professional services without an accompanying property damage or bodily injury incident.
Since mistakes often happen in the course of doing business, Professional Liability is necessary for many firms. While it can sometimes be added to a General Liability policy, in most cases it is only available through a stand alone policy.
Common claims that Professional Liability may respond to include a contract not being fulfilled or fulfilled according to the terms of the agreement, a deadline not being met, the service provided not being up to par to acceptable industry standards, or a mistake on the part of the service provider that caused harm to the reputation of the customer.
Who Needs Professional Liability Insurance Protection?
Any organization that provides a professional service, training or teaching of any kind, informational or educational products, or offers a service that could affect the outcome of the client’s financial success should have a Professional Liability insurance policy. Though professionals will always try to do their best for their clients, mistakes do still happen. Additionally, in some cases this type of policy is required under contracts with vendors or customers.
We specialized in insuring a wide range of professionals and industries
- Engineers and Architects
- IT Professionals and Technology Consultants
- Specialty Trade Contractors
- Marketing and Multimedia Professionals
- Retail Professionals
- Doctors, Nurses and Healthcare Professionals
- Attorneys and Public Officials
- Web Programmers and Graphic Designers
- Small Business Consultants
- Accountants, Bookkeepers and Tax Preparers
What Kind of Coverage Does Professional Liability Provide?
The type of coverage needs to be based solely off of the services that the professional or business owner provides. The policy should be carefully written so that it covers exactly what is needed for specific companies.
This policy coverage provides an attorney for legal defense, and pays up to the policy limit in the event of an adverse jury verdict or a settlement is reached.
The policy typically covers the business as well as employees, managers, owners and executives of the organization. Independent contractors are sometimes covered, specifically if providing coverage for them is a contractual obligation, and if the contractors were working only for the policy holder at the time an incident occurs that later becomes the basis of a claim.
Certain circumstances, however, are typically excluded from an Errors & Omissions policy. These exclusions include actions that are knowingly dishonest or fraudulent; ERISA violations; violation of state or federal anti trust laws; infringement on another entity’s patent, trademark, copyright, or trade name; bankruptcy or insolvency; actions taken before the retroactive date; prior litigation; pending litigation; and receiving profit that legally is not appropriate for the policy holder to receive.
How Much Will It Cost to Get Professional
Liability (E&O) Insurance Coverage?
While prices vary from business to business, policies typically start with a minimum premium usually between $500 to $2,500. The premiums increase as revenues increase.
In addition, the type of business, size of the business, profit & loss history, risk management procedures, and other business details factor into the price of the policy.
If you would like to learn more about professional liability (E&O) insurance or are ready to get your customized quote, simply apply online now or call us toll free at 1-800-622-7370.
There are absolutely no obligation or commitments, and your quote will be sent in just a few hours in most cases. With no application fees, low rates and personalized service from an agency you can trust you’ve got nothing to lose.