Errors & Omissions Insurance, also known as Professional Liability Insurance, provides valuable protection for professional service providers from claims of negligence or failing to perform professional duties correctly.
What is Covered?
Errors and Omissions Insurance provides coverage for most every alleged claim that is not considered an intentional act:
- Alleged or actual negligence claims
- The cost to defend your business
- Libel or slander claims
- Infringement upon copyrights
- Coverage provided on a worldwide basis
- Coverage for temps, independent contractors and remote employees
- Actions brought from services provided in the past
- Financial claims and damages
Any business or contractor that holds themselves out as a professional or expert is subject to an Errors & Omission claim. Any business that is required to be licensed to operate is especially susceptible to these types of claims and the most expensive part of the claim may be just defending your business. There are particular claims that may not be covered, however:
- Claims for bodily injury or property damage
- Employee matters such as wrongful termination
- False advertising or intentional slander and libel
- Intentional fraudulent acts
- Intentional infringement of patents and trade secrets
Intentionally exposing personally identifiable information
No Limit to Number of Vehicles
For example you are contracted as a marketing consultant to create a logo and other advertising material for a new product. You then unintentionally use a logo design very similar to a competitive product and your client is sued and sues you as a result. In this case, your Errors and Omissions policy will respond by offering defense costs and the funds that may be needed for a settlement or financial award by the court. Another example might be that you are hired as an independent contractor to offer IT technology consulting for your client. As a result of your service, a virus is introduced into your client’s system that allows a hacker to access the client’s database. In this instance, your client is more than likely to bring an action against you for failure to perform professional services and your Errors and Omissions policy will respond.
