Professional Liability (Errors & Omissions)

E&O Policy Overview

E&O coverage kicks in where your Commercial General Liability policy does not provide coverage, such as for service errors, contract performance disputes, or any other professional liability issues. These policies also include defence costs, which can be quite substantial even if liability is not found. Policies typically do not provide coverage for non-financial losses or for intentional or dishonest acts.

E&O policies generally have both a claim limit and an annual limit, which is based on the insured’s exposure. The claim limit is the maximum amount that will be paid for any single event, and the annual limit is the maximum that will be paid in any one year. Typical limits range from $250,000/$500,000 to $2 million/$4 million and differ depending on the type of business.

To be eligible for this specialized insurance, candidates normally have to have proof of licensure in their “covered class of business.”