The Importance Of Errors And Omissions Insurance

In any industry, if a customer hires a professional service provider to provide quality services, they have high expectations that the service provider will perform at a level that is acceptable. If you are a service provider offering advice on insurance, financial products and investment vehicles, or real estate, you must recognize the importance of investing in errors and omissions insurance. This specialized commercial insurance policy is designed to protect individuals who are licensed in their industry against faulty performance and negligence, which can cause financial harm to their customers. Faulty performance can include a negligent act or an unintentional omission by the company or the professional providing the service. Because this type of coverage is specifically excluded from a general liability package, you must obtain separate quotes to build a comprehensive insurance portfolio.

Errors and omissions insurance is most commonly referred to as e & o insurance or professional liability insurance depending on the industry in which you serve. Studies have shown that a majority of businesses who do not carry errors and omissions insurance and who face a liability claim covered by this contract will go out of business. To protect not only your business, but also your reputation and your name, you must invest in this policy and pay small annual premiums rather than hundreds of thousands of dollars in a civil lawsuit.

Today's litigant society has forced a number of businesses to close their doors. Even if negligence and omissions claims are unfounded, small businesses and corporation end up paying thousands of dollars in defense fees, which ultimately affects profits and operations. Errors and omissions policies will pay for not only the settlement amount of a claim, but they will also pay for defense costs and judgments if the claims department and adjuster feels the claim is unfounded. This means that the insurance company will defend you until the bitter end to avoid a false claim being paid. This is not only for your better interest, but for theirs as well since they are ultimately the ones who will be paying the settlement or judgment. Better defense means you have a better chance of having the claims dismissed or reduced before it even enters court.

Several different professionals and companies should consider investing in errors and omissions insurance. Doctors, lawyers, financial services professionals, real estate agents, insurance agents, mortgage brokers, and subcontractors are just a few of the many professionals who should not go unprotected. With a variety of different commercial insurance providers offering packages ranging from 1 million to 10 million dollars in coverage, you can tailor a plan the suits your needs and fits your budget all in one. Find a package designed for your profession and do not go unprotected.






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