Errors and omissions insurance

Errors and omissions insurance, otherwise known as malpractice insurance is essential protection for service providers such and doctors, lawyers and many other professional practices. Professionals are people who possess certain important skills necessary to render unique services. This type of insurance is critical for companies that provide professional services to others.

Although there is no standard E&O insurance policy, E&O insurance generally covers the professional, his or her partners and employees, and the professional’s corporation or partnership for damages directly caused by providing or failing to provide professional services. For lawyers, accountants, real estate agents, actuaries, consulting firms and many other professionals, damages usually mean a monetary loss suffered by the professional’s client as a direct result of relying on the professional’s work. For some professionals, such as medical professionals, in addition to covering financial losses, there is frequently coverage claims-made policies usually contain various options to purchase an extended reporting period.

In addition to law firms, accounting firms, architectural firms, engineering companies and all of the other traditional professional service firms (those whose main business is providing professional services to others), many other companies employ professionals and thus have E&O exposure. It is prudent to explore an E&O policy for the following businesses: Media companies, including television, radio, newspaper, film, etc. Technology providers including hard
ware/software companiesandinternet-related businesses should also purchase errors andomission insurance cover.It is also important to note that there are many businesses that have E&O exposure that are not generally considered professional practices examples include:advertising agencies, public relations firms, mortgage bankers and court reporting companies.

Errors and omissions insurance policies respond to claims allegingthat a professional has caused damage tothe claimant by providing or failing toprovide professional services in accordance with applicable laws and regulations orby delivering a service that fell below thestandard of care for their profession.Examples of typical allegations are listedas follows:the exclusions employed in E&O policy vary, based on the class for which the policyhas been written. Here are a few exclusion common to many policies:Criminal, fraudulent, deliberatelywrongful, or malicious acts,Bodily injury and property damage (exceptcertain medical and design professional)guarantees or warrantees, services as a director ofa company,liability for workers compensation,liability for workers compensation , claims stemming from previouslyknown but undisclosed errors,services as a governmental officialand the E&O policy covers claims relateddirectly to the provision of professionalservices, not to losses involving automobile liability, general liability, fidelityproperty, workers compensation.

Many E&O claims can be avoided and theseverity of E&O claims can be mitigatedwhen professionals follow these guidelines: always usesome type of writtencontract, try tocommunicate with clients continuously,honestly and openly,stay within the walls of a certain expertise and referringprojects outside your expertise to other professionals, but make sureto recommend several qualified professionals. However, it remains very important for professionals to obtain this cover.

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