Professional Liability Insurance Is Also Known as Malpractice or Errors & Omissions (E&O)
Professional Liability Insurance, also known as Malpractice or Errors & Omissions (E&O) protects companies and individuals against costly and potentially catastrophic litigation (damages and defense costs) caused by charges of professional negligence or failure to perform professional duties (acts, errors or omissions).
The most common claims include:
- Design/programming errors
- Contract performance disputes
- Violation of good faith and fair dealing
- Inaccurate advice
- And many more
Coverage for these types of claims is not provided by a general liability policy, so it is critical for businesses to have Professional Liability insurance.
In the litigious world we live and work in, claims can often be baseless, and mounting a legal defense can send uninsured companies into a financial crisis. Among other things, professional liability coverage provides for legal defense costs, which can be substantial, even where there has been no wrongdoing.