Do you know what E&O or errors and omissions insurance is all about? Errors and omission is a type of insurance that covers your company or you individually from clients that deem you liable for a service that you or the company performed or catastrophically performed a service that have gone out wrong.
On the side of doctors, dentists, chiropractors and etcetera, it is normally known as malpractice insurance. In aid of lawyers, accountants, architects or engineers, this insurance is known as professional liability. Regardless of what people call it, this protects the company or you individually from the errors or omissions that you have done or what the client believes that you have done.
The majority of errors and omissions (E&O) policies include judgments, settlements and defense expenses. Even if the accusations are found to be unjustified, a lot of money is needed to be able to defend the court case. These kinds of lawsuits are very capable of bankrupting a small company or an individual plus it has a lasting effect on the outcome of larger companies.
In cases like these, there will be a very big possibility that you or your company would be bankrupt. To cut a long story short, errors and omissions (E&O) coverage helps you survive these types of lawsuits.
The best known professionals who are in need of E&O insurance are doctors, accountants, lawyers, architects, engineers, and a lot more. On the other hand, companies and other people who are in advertising agencies or commercial printers, web hosting companies to wedding planners, people who provide their services for a certain fee should as well obtain E&O insurance. They should not expose themselves with these kinds of danger for the company’s sake and theirs as well. Normally, E&O insurance is suggested at the establishment of each insurance group of a firm or a business. Customarily it would be a good idea to get hold of the coverage when you launch your product or when you have clients.
Companies who deal with customers or clients should have this coverage. Why? Well, simply because nobody is perfect, everybody makes mistakes. Even the most excellent employees that you hired are bound to make mistakes.
If a removalist company delivers the belongings of the customer and some of them are damaged due to negligence, who would be paying for the loss? Or if a freight forwarder sends a shipment to England instead of Finland and this shipment is needed right away by the client, so there would be a great possibility that the client would lose a sale and who pays for the loss incurred?
If you or the company would not purchase E&O insurance, there will be a very big financial risk for you or the company. In addition to that, these kinds of losses are not included in general liability policy. And even if it is not your fault, there will still be fees to be paid and not to mention the wasted time.
Geroge Bay has worked with professionals in their fields to help prevent Errors and Omissions law suits against the company. The right insurance is a big factor in helping to prevent costly law suits against the company. Click here to get your own unique version of this article with free reprint rights.