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Errors and Omissions Insurance, Who Needs It?
Along with malpractice insurance, errors and omissions (E&O;) insurance plans fall into the same category as professional indemnity insurance and protects the policy holder against financial losses due to harm caused to a third party through mistakes or negligence. This type of policy also helps with claims made against the insured person or business in court.
There are several benefits that come along with error and omission insurance, including the insurance company conducting their own investigation into any claims made to ensure their client is treated fairly - see more information on this by visiting www.markeluk.com. If the case ends up going to court, the legal defense fees will be covered and any award amount - whether settled in or out of court - will be paid up to the coverage amount. Without errors and omissions insurance, the professional is responsible for paying fees and settlement out of their own pocket, which can be incredibly expensive and may result in the future of the business being cast into doubt.
Errors and omissions policies cover mistakes and acts of negligence that professionals may commit during the course of business and which result in harm to another party. This does not have to include physical harm as this type of policy covers against any financial loss of a third party due to advice given. Errors and omissions policies will extend cover to any employees and independent contractors working on behalf of the professional.
Errors and omissions insurance policies would benefit professionals such as doctors, lawyers, financial advisers, caterers and accountants and the amount of coverage should reflect the industry averages to ensure the correct level of cover.
Even years later, companies can still be held liable for damages and in this circumstance, 'run-off' coverage is well worth investing in. Even if the company has closed down, claims can still be made and this will ensure you are not out of pocket for defense fees or any settlement made. More info on Errors and Omissions Insurance at Wikipedia.
Disclaimer: This site is not , nor should it be taken to be, legal, financial or other professional advice. It merely provides a generalized guidance and generalized information only. Consult a financial advisor or an attorney to discuss any legal or financial issues involved with credit and debt decisions.
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