Those that provide professional services come under constant scrutiny and this requires errors and omissions policies from a la insurance company. It certainly makes perfect sense as a way of taking preventive measures against any possible damages that may occur, as opposed to waiting for an issue to develop and then deciding you need protection.
A seemingly simple error can ultimately have devastating consequences, ruin a great reputation, and end up costing a small fortune, whereas you can properly protect your business by having coverage that comes with a reasonable premium in place. Errors & Omissions (E&O) insurance is a practical part of your insurance portfolio, the type of coverage for professionals and businesses that need to protect their companies against claims with regards to their work performance.
Who needs E&O insurance?
You are a likely candidate for an E&O Policy if you are a doctor, dentist, lawyer, architect, engineer, event manager, accountant, or provide professional services for many different types of organizations.
Most professionals are likely to make a mistake during the course of providing their services. Although unintentional, there is the likelihood that a client may decide to sue for any substantial loss of time and money resulting from the error. In many cases, you may be getting sued for things that were not completely in your control, but you may still be expected to compensate the other party or, at the very least present your case in court.
This is where an E&O policy can help you to save time and money. This coverage will be far less expensive than any settlement that is ruled against you. For example, if an event planner were to book a venue on the wrong date, the event planner would likely end up having to compensate the property owners and workers for any lost time and revenues.
Declining to provide compensation, apart from getting the person entangled in a lawsuit, could cause considerable damage to their future business as well. If a potential client discovers that you have lawsuits pending against you, or your former client states that your services are unreliable, you certainly run the risk of losing business. Speak to an agent about obtaining coverage from a la insurance company for complete protection.