Errors and Omissions (E&O) Insurance
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Errors & Omissions Insurance Addresses the Special Risks Faced by Experts
When your business is based on sharing your expertise, you need comprehensive, cost-effective insurance to protect you from damages or legal costs that may arise. Errors & omissions insurance (or E&O insurance), also known as professional liability or professional indemnity insurance, provides important coverage. And when you get your errors & omissions insurance from biBERK, you’ll save up to 20% over other providers.
Getting Errors and Omissions Coverage is Simple With biBERK
What is Errors and Omissions Insurance?
As an expert, you must adhere to certain standards and best practices for your industry. If a client believes you made a mistake or oversight, they could claim that you didn’t meet those standards and sue your company for financial damages. Errors & omissions insurance protects you in the event that a client accuses your business of making a mistake (an error) or failing to do something (an omission), even if that claim proves to be groundless.
What Does Errors & Omissions Insurance Cover?
Errors & omissions insurance from biBERK helps protect your business if you make a mistake (error) or fail to perform a service (omission). E&O insurance also covers the related defense costs, even from unfounded claims. Claims can include the following scenarios:
Unfulfilled Duties
This happens when you’re expected to take certain actions but fail to do so. For instance, your accounting firm is supposed to file the client’s tax return by a specific deadline and you do not.
Negligence
Negligence occurs when you fail to use proper care when performing an important task. For example, as an insurance agent you fail to advise a client about important coverage and they’re left with a wide gap in protection.
Errors
In this instance, you’re being held responsible for a mistake made by you or your employee that caused your client a financial loss.
E&O insurance covers the cost of damages—including punitive damages if coverage of them is allowed by law in your state—up to the policy limit. Punitive damages are assessed by courts on top of other damages, and can be very high. biBERK also covers the cost of your legal defense and provides an attorney to represent you.
Why biBERK E&O Insurance?
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Save money.
We insure your small business directly, without a middleman or insurance broker, so we pass that savings on to you—up to 20% less than policies with other insurance companies.
Experienced.
We're part of Warren Buffett's Berkshire Hathaway Insurance Group with millions of satisfied customers, more than 75 years of insurance experience, and $52.2 billion in paid claims in 2023.
Who Should Consider Errors and Omissions Coverage?
If you provide a professional service, if you give advice to clients, or if you’re obligated by a contractual agreement, you should consider having errors and omission coverage.
- Attorneys
- Certified financial analysts
- Corporate trainers
- Financial advisor
- Home inspectors
- Insurance agents
- IT consultants
- Loss control inspectors
- Notaries
- Real estate agents and brokers
- Software companies
- Travel agents
- Tutors
Get an Errors and Omissions Insurance Quote
The best way to understand the true value of E&O coverage is to get an errors and omissions insurance quote from biBERK. With that number in hand, consider that the costs associated with a single lawsuit over a mistake you made or are alleged to have made can easily run into the tens of thousands of dollars or more. Your errors and omissions policy can help cover those costs so that your company avoids serious financial harm.
When it comes to errors and omissions insurance cost, there’s really no comparison to the potential hazards of an incident while being uninsured.
Errors and Omissions Coverage: Protection Beyond Claims
Depending on the errors and omissions coverage you choose, your insurance can protect against more than just claims related to errors, omissions, or negligence. Other protections can include:
Claims Arising From Past Services (Based on Retroactive Date)
On policies with a retroactive date or full prior-acts coverage, costs from incidents that occurred before coverage began may be covered.
Legal Costs Associated With Groundless Claims
Litigation costs associated with E&O insurance claims may be covered even in the case of false accusations.
Cyber Liabilities
This add-on covers data breaches and cyberattacks that result in the loss, theft, or accidental release of a client’s personal information.
Understanding E&O Insurance Retroactive Dates
Having a retroactive date means your E&O insurance can cover claims that are filed after coverage begins for incidents that occurred before the policy was active. For example, let’s say your E&O policy began on June 30, with a retroactive date of January 1. On July 15, a former client claims you made a mistake on their taxes in March, which you were unaware of when you purchased the policy.
Since the occurrence causing the claim took place during the retroactive coverage period (between January 1 and June 29) and the claim is made during your regular coverage period, you’ll likely be covered. With full prior-acts coverage, you’ll have coverage for all services provided before the policy period. If you haven't bought a policy before, claims will only be covered if the error, promise, or negligent act happens during the policy period.
Are You Required to Have Errors and Omissions Coverage?
Whether or not you’re required to carry errors and omissions insurance depends largely on your line of work and the inherent risks. For example, in an industry like architecture or engineering, your risks may be higher since you may be designing expensive structures or machinery. It’s likely that your clients will require you to carry errors & omissions insurance, which will provide financial protection if you’re named in a lawsuit.
What Isn’t Covered by Errors & Omissions Insurance?
Errors & omissions insurance is fairly comprehensive. However, there are some things that aren’t covered with your policy. For example, biBERK and other typical E&O policies don’t cover product guarantees or warranties your company makes. We also don’t provide coverage when a client is simply unhappy with your work. For coverage to apply, the claim must be the result of an error or omission. A few other exclusions include:
Illegal Acts or Costs of Defense for Criminal Prosecution
We’re here to protect you from financial risks resulting from honest mistakes. Breaking the law is outside of the scope of coverage.
Employee Injuries and Related Costs
To pay for your employees’ health care bills and lost wages in the event of a work injury, you’ll need a workers’ compensation policy.
Regular Accidents That Aren’t Related to Your Expertise
Trips, falls, and other incidents can occur at any business and in any industry. They’re covered by a general liability policy rather than E&O insurance.
Damages to Your Business Property
A policy that offers property coverage, such as our business owners policy or BOP (also called property & liability insurance), is designed to protect your company’s assets, such as computers, tools, or other necessities.
What Does Errors and Omissions Insurance Cost?
biBERK’s E&O insurance policies start around $300 and can go up into the thousands. This errors and omissions cost is based on a number of factors, including your specific industry, the level of coverage you select, your years in business, number of employees, revenue, and the policy limits you need. Professional indemnity insurance is an affordable way to protect your business, but there are also ways you can further reduce the cost:
biBERK Insurance Coverage by State
Coverage Map chevron_rightHow do I Save Money on Errors and Omissions Coverage?
Errors & Omissions Insurance Frequently Asked Questions (FAQs)
We’re always happy to assist you, but below are answers to errors & omissions insurance frequently asked questions.
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What is errors and omissions insurance?
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Errors and omissions insurance (also called professional liability insurance) can cover your company if a client accuses you of making a mistake. This might be something you do incorrectly (an error) or something that you fail to do (an omission). The coverage applies even if the claim proves to be false.
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What is the difference between professional liability and errors and omissions insurance?
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Actually, those are just two different names for the same type of insurance. “Errors & omissions insurance” is just a little more descriptive.
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What is a retroactive date?
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A retroactive date is a date agreed on by you and your current insurance company. Any work done by you before the retroactive date will not be covered under your current policy or this policy. You likely will find this date in your current policy documents or from your current agent.
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How much does errors and omissions insurance cost?
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What you’ll pay for errors and omissions insurance depends on factors like your industry, years in business, and number of employees. The level of coverage you select also affects your cost. Our errors and omissions insurance policies start around $300 and go from there.
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Who needs errors and omissions insurance?
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If your business provides professional advice or services, you should have errors and omissions insurance. In some cases, coverage may be required by law.
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Trust biBERK to provide the right errors & omissions insurance for your small business.