E&O insurance, also referred to as professional liability insurance, can help provide financial protection for companies and professionals if a client alleges their work is inadequate or they committed a negligent act.

E&O insurance can help an insured pay for the following expenses, subject to policy limits:

Judgments: Monetary damages awarded to the plaintiff.
Attorney fees: Costs of hiring an attorney to defend the insured.
Court costs: Costs such as filing fees.
Settlements: Claim settled out of court.

E&O insurance can cover the costs arising from various service-based business liabilities, including:

Negligence. Professional negligence occurs when a professional breaches their duty of care or fails to perform their services to the required standards of their profession.
Errors. Losses resulting from errors, mistakes, or oversight in performing a service may be covered.
Omissions. Losses resulting from a professional leaving out important information that a client needs to know may be covered under E&O insurance policy.
Misrepresentation. A professional that presents themselves as having experience in an industry when they don’t, may be considered a misrepresentation.
Inaccurate advice. A client who believes they have been financially harmed by a professional’s advice can bring a claim against the professional.