Highlights:
- Errors and omissions coverage benefits professionals who charge fees for their services.
- Many professionals don’t think about E&O liability, and claims can come as a nasty shock.
- COVID-19-related losses are making E&O coverage more important than ever for businesses.
- Agents should explain to clients why E&O insurance is vital to complete protection.
Do you have a client who needs E&O insurance? Or perhaps one who needs to increase or change their E&O coverage? Unfortunately, many business people don’t think about errors and omissions insurance until a claim takes them by surprise. Take a look at what agents should know about who needs E&O coverage and how to reach out to these clients.
Who is E&O Coverage For?
In most professions, professional liability coverage is a given. For example, if you’re insuring doctors, you know that they’ll need malpractice insurance to cover potential mistakes or unintended negative consequences of treatment. The industry-specific term for this type of professional liability insurance is malpractice insurance.

But not all industries have industry-specific insurance. For example, a client can sue a fitness instructor whose methods caused them to sustain an injury. A general liability policy won’t cover this because the injury is not the result of a slip-and-fall or other accident. Instead, what the fitness instructor needs is an insurance policy that protects against claims of their own mistakes or negligence. When a policy provides this type of coverage to a professional who provides a service, it’s a type of professional liability insurance called errors and omissions (E&O) insurance.
Who Needs E&O Coverage?
Any professional who charges a fee for a service could be held liable if something goes wrong. Some scenarios might include:
- A real estate agent who fails to disclose a dispute over water or mineral rights with the owner of a neighboring property might be sued for breach of duty.
- A property manager who evicts a tenant for reasons not outlined in the lease may be sued for wrongful eviction.
- Accountants are commonly sued for errors on a client’s tax return because even small errors can have very expensive consequences for clients.
- A technology or IT firm could be sued for a data breach if they fail to provide adequate cybersecurity.
- Even insurers can be sued – for example, for failing to provide adequate coverage. Insurers are seeing more than the usual number of lawsuits for inadequate business-interruption coverage because of COVID-19 related shutdowns.
Is Your Agency Reaching Out?
Is your agency insuring professionals who provide services? If so, your agents should be making E&O insurance a priority. Agents should be encouraged to review their clients’ coverage with them and make suggestions for increased coverage as necessary. Stress that clients without adequate E&O coverage are not fully protected from errors and omissions claims.
The American Agents Alliance is there for agencies that need to learn more about E&O coverage and how to reach out and promote it to clients. Contact us to learn more about E&O Insurance.