Does Your Company Need for Errors and Omissions Insurance?
If your business provides consultations, services, or sales, Errors and Omissions Insurance shields you from claims by clients against services rendered or professional guidance. Clients have the ability to file claims if an error or omission results from your services or failure to provide them. There are multiple types of insurance coverage for these issues, including malpractice, professional liability, directors and officers, and errors and omissions (E&O).
What is Errors and Omissions Insurance?
Errors and Omissions Insurance policies provide customized plans to protect your business and its employees from having claims or lawsuits filed against them by clients who have suffered from an error or failure in service. Depending on your needs, your E&O Insurance plan can cover the cost of attorneys and settlement if found guilty.
Review the following information about E&O Insurance for your business:
- Errors & Omissions Insurance protects W2 employees and 1099 subcontractors internationally
- This coverage is required by several VC’s and other types of investors, and also required for licensing and potential jobs at both state and federal levels.
- Commercial or General Liability policies are limited in how much coverage they offer for these claims, or more likely offer no coverage at all
What Professions Benefit from Errors and Omissions Insurance?
The following professionals highly benefit from Errors and Omissions Insurance:
- Home Inspectors
- Consulting Companies
- Advertising Agencies
- Web or Graphic Designers, Programmers, and IT Firms
- General Contractors, including Building Maintenance and Custodians
- Financial Advisors, Bankers, and other Finance Services
- Professional service providers: Lawyers, Medical Practitioners, Chiropractic Care, or Dental Care
- Educational Institutions, Grade Schools, High Schools, Universities, Colleges, Private Schools, and Tech/Vocational Schools
What Should E&O Insurance Contracts Include?
Every Errors and Omissions Insurance contract differs in cost depending on your needs. Contracts should be written according to your business practices and address important information such as:
- Cost of each liability in dollars
- Each liability’s deductible
- Defense cost deductible
- A definition of the use for policy, for example: “This policy pertains to errors, omissions or negligence in the course of providing or failure of providing professional services.”
- A fully detailed list of services your business provides
- Retroactive claims dates (excludes submission of occurrence forms)
All companies are prone to make mistakes; however, with the proper coverage, your company and its employees are protected from a huge financial loss. Invest in Errors and Omissions Insurance to avoid these potential claims or lawsuits and save time, money, and unnecessary aggravation.
If you’re a home inspector in need of insurance, contact us today!