Depending on the business you are in, you may have heard the terms professional liability and errors and omissions (E&O) insurance. But, while the names and the language used may differ by industry, the type of protection that these policies cover is essentially the same.
Professional liability insurance is a type of coverage that protects attorneys, as well as physicians, and accountants/CPAs against negligence and various other claims that are initiated by their clients.
Regardless of whether these allegations stem from intentional or unintentional negligence, misrepresentation, or even malpractice, it is still possible to be sued, and in turn, to incur significant expenses – no matter which way the verdict goes.
Likewise, errors and omissions (E&O) insurance is used by insurance agents, consultants, and financial professionals, and it covers business-related mistakes and/or undelivered services that cause financial harm to a client of the advisor.
If a customer sues a professional on the grounds of inaccurate advice, misrepresentation, negligence, and/or a violation of fair dealing and good faith, a professional liability or E&O insurance policy can pay for a wide range of costs, such as:
- Attorney’s fees
- Cost of expert witnesses
- Court expenses
- Legal settlement expenses
- Administrative costs
Some of the items that will not be covered by professional liability or errors and omissions insurance include:
- Fines, penalties and sanctions
- Cyber related losses
- Employment-related costs
- Business management mistakes
- Illegal acts
- Acts that are deliberate and/or misleading
When purchasing E&O/professional liability insurance, it is important to ensure that you obtain enough protection. Working with a seasoned professional with more than four decades of experience in the professional liability / E&O insurance arena can help.
If you have any questions regarding the type and amount of coverage you may need, or to obtain a professional liability insurance quote, contact Coastal Insurers toll-free at (800) 368-3363 ext. 1001, or send us an email at blair@coastalinsurors.com. We look forward to assisting you.