The Ins and Outs of EO

Axis Insurance Services

For service-providing companies or individuals that provide professional advice, errors and omissions is a special form of liability coverage that goes into effect with claims of negligence. According to Axis Insurance Services, this form of liability differs from a director and officer policy, as it extends to the employees of the company and the business itself.

Areas of Coverage

Errors and omissions are also referred to as professional liability insurance, and the design is to keep companies or individuals from carrying the full financial weight of defense against a legal claim made against them. The types of claims covered could include:

Concerns of negligence due to misinformation
Accusations of malpractice and lack of action
Identifying consequences from design flaws
The financial damage to the client because of advice or operations
Areas It Won’t Cover

Unfortunately, there can be a number of claims brought against your company or services where the areas will not be covered by an E&O policy. Any claims arising from situations where an employee or individual acted illegally, such as fraud, intentional harm, employee injury, or business property lawsuit are not included in this coverage.
For companies who primarily offer services and professional advice, adding an E&O policy is one way to keep a terrible situation from financially ruining your business. It can possibly be added to your existing policy, or you can purchase a stand-alone plan.

Areas It Won’t Cover

Unfortunately, there can be a number of claims brought against your company or services where the areas will not be covered by an E&O policy. Any claims arising from situations where an employee or individual acted illegally, such as fraud, intentional harm, employee injury, or business property lawsuit are not included in this coverage.
For companies who primarily offer services and professional advice, adding an E&O policy is one way to keep a terrible situation from financially ruining your business. It can possibly be added to your existing policy, or you can purchase a stand-alone plan.