Your business mistakes are liabilities for other people—your clients, vendors and others. Therefore, if you cause accidents, you might have to pay for the damage. However, damage costs alone are not the only bills that might arise. Lawsuits, and their associated costs, will often beckon in case you face liability claims. When it comes to your Errors & Omissions (E&O) insurance, then you might have help available. Let’s take a closer look.
Liability insurance and legal assistance go hand in hand. That is why you always need to tailor your coverage to your financial benefit.
Errors & Omissions Insurance
An errors & omissions policy is sometimes called professional liability insurance. It is different from your standard general liability insurance, which pays for the bodily injuries or property damage you might negligently cause others. E&O coverage, on the other hands, applies to the professional or clerical mistakes you make that harm others.
For example, lawyers often need E&O insurance. That is because they provide professional services and advice to clients. This advice might cause the client to suffer personal or financial losses. It is an E&O policy that can compensate them for their losses.
Legal Assistance With E&O Coverage
E&O claims and legal assistance go hand-in-hand in many ways. E&O policies address liabilities, and liabilities are the mistakes you make that harm others.
Therefore, E&O claims usually must involve negligence on the part of the company. Negligence means that you failed to take proper care in doing your duties. Therefore, even though the mistake was a mistake, you still might have been able to prevent it. This failure, therefore, might give the person you harmed enough incentive to sue you.
Liability lawsuits cost businesses millions of dollars each year. On one hand, the costs of settlements could arise. Furthermore, you might accumulate legal fees simply as you spend time trying to fight the suit. The good news is that E&O policies can often cover your legal costs.
Even if you have to pay nothing in liability settlements, and even the lawsuit fails, that doesn’t mean that legal fees will vanish. E&O litigation can take significant amounts of time, and the various court costs could mount quickly. However, if you have enough E&O protection available, you can receive compensation for these costs.
To ensure you have legal assistance available, talk to an E&O insurance agent at ProAccess about the structure of your policy. Most policies offer at least $1 million in coverage. However, you can also increase this limit to receive more assistance for claims. Your policy needs to offer enough money to address both the costs of a typical liability claim and legal fees.
Also Read: Does E&O Insurance Cover Punitive Damages?