PROFESSIONAL LIABILITY OR ERRORS & OMISSIONS (E & O):
How does it protect me?
Professional Liability or Errors & Omissions insurance protects your company from claims if your client holds you responsible for errors, or the failure of your work to perform as promised in your contract.
Coverage includes legal defense costs, (no matter how baseless the allegations) including court costs, up to the coverage limits on your policy and the resulting judgment against you, if you are found to be in at fault in the lawsuit.
Errors & Omissions insurance coverage extends to both W2 employees and 1099 subcontractors, and can be worldwide in scope.
What is a Professional?
The definition of a "professional" has expanded over the years to include those occupations in which special knowledge, skills and when there is close client relationships. More and more occupations are considered professional occupations,
If your business provides any type of "professional" service or "consultation", you should have Errors & Omissions insurance. But....they are many other types of businesses that also should have this coverage, here are a few other
types of businesses that should also carry Errors & Omissions insurance;
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Advertising Agencies
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Any type of computer software/hardware installation and maintenance,
web developer, integration, marketing etc.
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Data processing
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Forensic Analysis (non-medical)
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Graphics Design Service
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Landscape Architects
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Personal consulting
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Project cost control consulting
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Architects
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Interior decorators
(and many others, if you are not sure if your business needs this
coverage, call and speak to one of our brokers, they will help you
to determine if this type of coverage is needed)
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Teachers
Why do I need Professional Liability Insurance?
Don't be fooled. Professional liability - Errors & Omissions insurance - is not provided by a General Liability insurance policy. In fact, it is usually excluded from the policy. General liability insurance does not provide coverage for errors,
contract performance disputes, or any professional liability issues. companies who have a general liability insurance without professional liability insurance, are taking a big risk. It's like a doctor practicing medicine without malpractice insurance.
Mistakes happen, Every company messes up at some point. Errors and Omissions coverage insures not only your mistakes, but also the mistakes of your employees and independent contractors. Most importantly: Errors and Omissions
insurance might save you from extreme embarrassment, a lost client, or worst of all, a bad reputation.
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