What Is E&O Coverage?

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What Is E&O Insurance Coverage?

Errors and omissions insurance (E&O), also known as professional liability insurance, helps protect you and your company from mistakes in your professional services. This coverage can help pay the costs if a customer or client files a claim against your small business.
 
what is e&o coverage? For example, after an accountant at your firm gives your client bad advice, they suffer a large financial loss. As a result, your client sues your accounting firm for negligence. E&O insurance can help cover your defense costs and any judgments or settlements.
 

What Is Included in Errors and Omissions (E&O) Coverage?

No matter how hard you try to avoid them, mistakes can happen. When they do, your customers can sue your business for:
 
  • Negligence
  • Errors
  • Omissions
  • Misrepresentation
  • Violation of good faith and fair dealing
  • Inaccurate advice
  • Personal injury claims, like libel and slander
  • Mistakes made by temporary staff and contractors
If your business faces errors and omissions claims examples or lawsuits like these, your E&O coverage can help pay for:
 
  • Damages, including any judgments and settlements that result from the lawsuit.
  • Legal defense costs, which can include attorney fees and other court-related expenses.
  • Disciplinary proceedings called by a regulatory, licensing or other government agency.
  • Loss of earnings as a result of the time you spend at depositions and trials.
  • Subpoena assistance if you’re a witness in a lawsuit.
Another benefit of getting your E&O policy from an insurance company like us is that you’ll have coverage across the U.S. and Canada.
 

Who Needs Errors and Omissions Insurance Coverage?

errors and omissions coverage Not sure who needs errors and omissions insurance? Some states and licensing boards require certain businesses to have this coverage. Even if it’s not required, you should consider including E&O coverage in your risk management plan if you work with customers.
 
Some businesses that can benefit from this insurance include:
 
  • Technology professionals, because tech failures can be devastating to your client’s finances. Software, hardware and electronic manufacturing businesses are at a high risk for errors or omissions lawsuits.
  • Management and business consultants who provide advice can get sued by unsatisfied clients.
  • Tax preparers, because mistakes or lapses in judgment can cost their clients money.
  • Accountants, because they give a wide range of financial advice, so their mistakes can have big financial impacts.
  • Advertising agencies, since they can get sued if an ad or campaign results in a financial loss for their client.
  • Graphic designers who create ads, brochures, magazines, corporate reports and more for their clients with mistakes that can be expensive.
  • Interior decorators, because clients who are unhappy with their advice and decorating services can file lawsuits.
  • Real estate agents, since they can get sued if agents misrepresent a property.
  • Travel agents, since a mistake can ruin a client’s vacation plans and lead to a lawsuit.
Having errors and omissions insurance sends a strong message to your clients that your business is reputable and trustworthy. It also shows that you’ve seriously thought about the risk of mistakes.

What Isn’t Included in E&O Insurance Coverage?

E&O insurance protects your business against a lot of risks and lawsuits, but it doesn’t cover everything. It will not help if you’re sued for:
 
  • Employment practices, such as wrongful termination or harassment. You’ll need employment practices liability insurance to help cover these claims.
  • Illegal acts or purposeful wrongdoing, including dishonest behavior or fraudulent actions.
  • Patents and trade secrets taken without permission. Your general liability insurance policy may protect you if you're sued for stealing intellectual property.
  • Bodily injury or property damage caused by your business. If your customer falls and gets hurt in your office or your employee damages your client’s property, you’ll need general liability insurance.
  • Work-related injuries or illnesses to your employees. Your workers' compensation insurance can help cover these.
  • Personally identifiable information that’s lost or stolen. Data breach insurance can help cover your costs to notify people and restore your reputation.

How Do I Get E&O Coverage?

Errors and omissions insurance costs are different for all small businesses based on your needs and risks. We make it easy for you to get errors and omissions coverage by getting a professional liability insurance quote online today.
The Hartford shall not be liable for any damages in connection with the use of any information provided on this page. Please consult with your insurance agent/broker or insurance company to determine specific coverage needs as this information is intended to be educational in nature.
 
The information contained on this page should not be construed as specific legal, HR, financial, or insurance advice and is not a guarantee of coverage. In the event of a loss or claim, coverage determinations will be subject to the policy language, and any potential claim payment will be determined following a claim investigation.
 
Certain coverages vary by state and may not be available to all businesses. All Hartford coverages and services described on this page may be offered by one or more of the property and casualty insurance company subsidiaries of The Hartford Financial Services Group, Inc. In TX, this insurance is written by Sentinel Insurance Company, Ltd., Hartford Casualty Insurance Company, Hartford Lloyd’s Insurance Company, Property and Casualty Insurance Company of Hartford, Hartford Underwriters Insurance Company, Twin City Fire Insurance Company, Hartford Accident and Indemnity Company and Hartford Fire Insurance Company. In Arizona, New Hampshire, Washington and California, the insurance is underwritten by Hartford Accident and Indemnity Company, Hartford Casualty Insurance Company, Hartford Fire Insurance Company, Hartford Insurance Company of Illinois, Hartford Insurance Company of the Midwest, Hartford Lloyd’s Insurance Company, Hartford Underwriters Insurance Company, Maxum Casualty Insurance Company, Maxum Indemnity Company, Navigators Insurance Company, Navigators Specialty Insurance Company, Pacific Insurance Company, Property and Casualty Insurance Company of Hartford, Sentinel Insurance Company, Ltd., Trumbull Insurance Company and Twin City Fire Insurance Company. The Hartford® is The Hartford Financial Services Group, Inc. and its subsidiaries, including Hartford Fire Insurance Company.
 
The Hartford® is The Hartford Financial Services Group, Inc. and its property and casualty subsidiaries, including Hartford Fire Insurance Company. Its headquarters is in Hartford, CT.
 
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