Professional Liability (E&O) Insurance
Professional Liability Insurance (E&O) covers businesses from damages caused as a result of their professional services or advice.
What is Professional Liability (E&O) Insurance?
Professional Liability Insurance (E&O) is a policy that professional service organizations purchase to cover liability arising from the services and advice they provide to their clients. This policy primarily covers when the rendering of professional services leads to financial harm of a person or company.
Why You Need It
1
To Satisfy Client & Business Partner Requirements
For many service organizations, such as architects, engineers, consultants, technology providers, lawyers, construction companies, and project managers, many of your clients will require that you have certain types of insurance. Often this will include a requirement for professional liability insurance of a certain amount.
2
To Minimize Risk For The Business
For many businesses, the financial fallout from a mistake in your work or giving incorrect advice is the single largest risk they face. Many business owners will purchase professional liability to cover that risk.
3
To Protect The Reputation Of The Business
For service businesses, reputation is everything. Having professional liability insurance enables you to fight lawsuits with the backing of an insurance company. Not only will the insurance company help pay for your legal defense, but they will also provide you with an experienced legal team who has specific expertise in defending professional service lawsuits.
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What Professional Liability (E&O) Insurance Covers
Inaccurate Advice
Advice given to your client that mistakenly had inaccuracies or omissions and results in financial harm to the client.
Mistakes In Your Services
Mistakes in the professional services you provide that cause financial harm to the client.
Misrepresentation
Misrepresentations that you or an employee make to a customer that cause financial harm to the client.
What Professional Liability (E&O) Insurance Doesn't Cover
Not Covered
Property Damage Or Bodily Injury
If your services result in causing property damage or bodily injury to someone as a result of your negligence, your general liability policy would cover these claims.
Not Covered
Employment Matters
Errors or mistakes in employment matters, such as wrongful hiring and firing of employees, are not covered.
Not Covered
Intentional acts
Professional liability only covers accidental mistakes.
Reasons To Have Professional Liability (E&O) Insurance Coverage
Professional Liability (E&O) Insurance is a must have for businesses that need:
To Satisfy Client & Business Partner Requirements
For many service organizations, such as architects, engineers, consultants, technology providers, lawyers, construction companies, and project managers, many of your clients will require that you have certain types of insurance. Often this will include a requirement for professional liability insurance of a certain amount.
To Minimize Risk For The Business
For many businesses, the financial fallout from a mistake in your work or giving incorrect advice is the single largest risk they face. Many business owners will purchase professional liability to cover that risk.
To Protect The Reputation Of The Business
For service businesses, reputation is everything. Having professional liability insurance enables you to fight lawsuits with the backing of an insurance company. Not only will the insurance company help pay for your legal defense, but they will also provide you with an experienced legal team who has specific expertise in defending professional service lawsuits.
What Does Professional Liability (E&O) Insurance Coverage Cost?
Costs can vary based on your location and the specific type of work you perform. Here are some examples of small business E&O quotes:
| Consultant | Executive Coaching | Residential Property Management | |
|---|---|---|---|
| State | CO | IL | IL |
| Revenue | $1,670,000 | $40,000 | $300,000 |
| Policy Limit | $1,000,000 | $500,000 | $1,000,000 |
| Deductible | $5,000 | $2,500 | $2,500 |
| Annual Cost | $1,770 | $650 | $5,625 |
Running a larger or more complex company comes with additional risk and increased premiums. Here are some E&O quote examples for larger companies:
| Medical Consultant | Property Estimator | Real Estate Property Manager | |
|---|---|---|---|
| State | CA | CA | NJ |
| Revenue | $110,000,000 | $64,000,000 | $200,000,000 |
| Policy Limit | $1,000,000 | $2,000,000 | $5,000,000 |
| Deductible | $75,000 | $50,000 | $250,000 |
| Annual Cost | $77,000 | $20,000 | $65,000 |
Frequently Asked Questions
What Our Customers Are Saying
I’ve worked with Austin at LandesBlosch. He is upfront and honest, active in the community, and helpful even beyond basic insurance. I’d recommend LB to anyone.
Colton J.
I have been with Guy Landes and the LandesBlosch agency for almost 20 years. Guy Landes and his staff have been there for me and my entire family through several claims as well as guiding us successfully to ensure our family’s ever changing and growing business. Whether you are looking for personal or commercial insurance, you cannot find a more devoted and competitively priced group than the LandesBlosch Group!
Mike S.
Buying insurance can be a daunting task because of the complexity of each policy. LandesBlosch has been a game changer for my business. They held my hand through all the different options that my businesses may or may not needs to make sure I'm not underinsured. This reduces my personal stress and my business liability.
Dalton P.
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