Virtually any type of business will require that you have insurance and included in your plan will likely be Directors and Officers, Errors and Omissions or some type of combination of these two types of coverages. Learn the differences and similarities between D&O vs E&O for when you discuss options with your insurance agency.
Errors and Omissions
While both types of coverage protect against negligence, these types of insurance are aimed at protecting different individuals. Errors and Omissions coverage deals primarily with protecting a company’s employees, representatives and clients to a certain degree. In this type of plan, you can expect to see coverage for the following:
- Flaws in design
- Any financial damage resulting for the client
- Directors and Officers
For D&O, only directors and officers are covered which means employees and representatives do not benefit from this plan. Some other things that you will see addressed in this include:
- Distribution of private information
- Funds mismanagement
- Conflicts of interest
- Unfair employment or business practices
For any effective insurance plan, it is important that all bases are covered. Depending on the nature of your business you may only need one type, or perhaps both to supplement each other and cover everyone in your company. Regardless, a qualified agent can help you to determine exactly what you need.