Does your business have enough insurance? This might seem like a silly question when you sell insurance. However, it’s amazing how many businesses lack a vital piece of their own insurance puzzle: Errors and omissions (E&O) insurance.
Why Do You Need E&O Insurance?
Even if your business is very accurate, it’s likely that you’ve made a mistake or two in the past and that you will make a few in the future as well. We’re all human, and processes can be fallible. E&O insurance is there to make sure that the any mistakes you make won’t impact your agency in a way that destroys your finances. If you make an honest error or omission, you are covered by insurance.
Is There a Risk In the Work That You Do?
While some businesses don’t work in an area in which errors could lead to business liability, your insurance agency does. A mistake on an individual’s insurance policy may not be a big problem. In most instances, people will not need to use a lot of the insurance that they purchase. However, if a client goes to use their insurance and they don’t have the right insurance or the right amount due to an error or omission on our part, this could severely damage their ability to recover from a loss.
In this kind of situation, your client may have no choice but to sue your business, because that individual needs to recover financially from the loss that they have incurred.
You could also protect data in a way that fails, leading many clients’ financial information to become exposed. There is damage to privacy but also potential fraud implications for your clients.
When you’re handling matters that involve financial information and protecting clients’ assets, you need E&O insurance to protect yourself.
What If You Rarely Make Mistakes?
Your quality control processes are excellent. In fact, you can’t remember the last time that you made a mistake of note. Anything that happens is usually minor and has no impact on the client.
While you might be proud of your reputation as an exceptionally accurate organization, here’s a stark fact: “you actually don’t have to make a mistake to have your company sued.” According to the Huffington Post, even if there is a perception that you’ve made an error or caused harm to one of your clients, that individual could sue your business.
Sometimes, clients get upset over the perception of an error, and in an extreme circumstance, this could result in a lawsuit. This would not only result in financial impacts. It would also result in a potential loss of future business, because it could hurt your reputation. E&O insurance can protect you in this situation as well.
What Insurance Do You Need?
You need many different types of insurance for your business. These include:
- Property insurance
- Auto insurance for corporate vehicles
- Worker’s compensation
- Employment practices liability insurance to protect yourself against employee lawsuits
Your insurance could also include policies that protect you against cyber theft as well. Adding E&O insurance to your business insurance protects you from problems that come from human nature rather than physical disasters. These problems can be devastating to your business unless you protect yourself with errors and omissions insurance.
At American Agents Alliance, we want to make sure that your business can succeed. This means that not only do we help you with finding new employees, marketing, and understanding the world of insurance – we also offer discounted products such as E&O insurance for your business. Sign up for our E&O insurance today.
