Businesses that service clients have a particular set of exposures related to errors and omissions (E&O) in the administering of advice, and some may even find it difficult to believe that this is actually the case. If you fall into this category you’ll be relieved that, if you find yourself involved in a lawsuit, you took the time to purchase New York E&O insurance.
It covers your company, or yourself as an individual, in the event that a client holds you responsible for services you either provided, or failed to provide. For many professionals, such as doctors, dentists, and chiropractors, the term used for this type of coverage is malpractice insurance. But for lawyers and accountants, or architects and engineers, its generally referred to as professional liability coverage.
What Exactly Does Your New York E&O Cover?
E&O policies are designed to cover judgments, along with any settlements and related defense costs. Even when those allegations are found to be false accusations, there’s still a significant dollar amount being spent to defend against the lawsuit. This can have a devastating effect on a mid-sized company, and could possibly bankrupt a smaller company or individual altogether. Even a large corporation could experience a lasting negative effect on their bottom line.
Having e&o coverage only helps if it has been acquired prior to any claims being brought against you, so the best time to buy a policy is before the risk is exposed. Anyone operating in the services industry should anticipate the likelihood of having these types of exposures, and make E&O insurance a part of their insurance portfolio.
In many cases, clients will require insurance to be in place prior to engaging in any contracted work, plus it also works as a selling point with clients because it gives them some reassurance knowing they’ll be compensated in the event that an error or omission occurs.
Look, everyone makes mistakes at one time or another. Even with the best employees, along with having the best risk management practices in place, mistakes can happen.
Protect your interest by contacting an agent who specializes in errors and omissions insurance, because its an important coverage to have if you even run the slightest risk of being sued.