If you’re in a profession such as real estate, medical services or legal services it’s very likely that you are required to maintain E&O insurance, also known as professional liability insurance. E&O insurance protects you against any errors or omissions you make in a professional capacity which could cause damages to your clients. Everyone will occasionally make a mistake, but these mistakes can lead to claims against you in the court of law. Without the proper E&O coverage, you will often need to pay for these mistakes out of pocket.
E&O insurance covers your liability in the event that you unintentionally omitted something or that you made a legitimate mistake. It cannot help if you intentionally left something out of contract or if you were extremely negligent in your duties. However, the insurance will cover most mistakes that you make on a professional basis. Like other types of coverage, E&O insurance can be shopped around to find the lowest rates, and it can have its coverage extended with the use of an umbrella insurance policy.