There are different types of insurance that you must acquire for your young or growing business. The coverage will protect you from financial and legal repercussions of unexpected problems. One of the most important forms of insurance that you should acquire for your practice to avoid losing monetary losses through lawsuits is the errors and omissions insurance.

This cover is also known as the professional indemnity insurance, and it is designed to protect businesses which provide advice or services from bearing the full financial responsibility of negligence claims and similar damages. Consider this short outline of the elements of your business which will be covered if you decide to apply for errors and omissions insurance online.

Defense Costs

If a lawsuit is launched against you for negligence or other form of damage, the E&O insurance cover will provide financial resources for your defense. Typically, the lawyer fees will be provided by the insurance company. The administrative and court costs which include the charges attached to filing, processing and copying documents are normally covered. If a settlement s agreed upon by the involved parties, the insurance will be responsible for the financial responsibility.

Negligent Claims

Alleged and actual negligent claims can be launched against you or your business. This type of situation occurs when you fail in your duty of care. In simple terms, a person can claim that you failed to take reasonable care while performing your professional work and this resulted in their harm. For example, a client might have received wrong advice or you might have allegedly made a costly mistake during the delivery of service. The E&O insurance will cover the claims.

Personal Injury Claims

The E&O insurance covers personal injury caused during the provision of professional service. However, the pertinent claims must be related to the person’s reputations. This includes libel, defamation and even slander. Normally, the coverage will protect you from the financial repercussions which will arise if a client makes a claim.

Prior Acts

There are incidents which might have taken place in the past within your business. If these issues come up after the effective date of the policy, claims can be made and covered. This is known as retroactive coverage. However, you should note that this does not apply to all insurance companies. Therefore, you should inquire about this before making an application for errors and omissions insurance online.


The exact elements of your business which are covered by the E&O insurance can vary significantly. Therefore, you should be diligent in making certain that the presented contract will provide the protection that your company needs. You should also remember that there are claims that are not covered by this type of insurance. Issues such as fraud, false advertising, physical injury, property damage and employee matters are not within the E&O scope.