Many people are confused about what error and omissions insurance will cover. This kind of insurance differs from other types of business insurance, in the fact that it provides coverage if you or someone in your company makes a mistake. Almost every type of business will want to have an EO insurance policy to protect their business Error And Omissions Insurances.
The particular policy you have can be tailored to meet the specific needs of your own business. For example, a personal trainer can get EO insurance that will provide coverage if something they do causes bodily harm to one of their clients. A consulting firm might need coverage that will insure them from financial losses due to a mistake or misinformation. At some point, everyone makes mistakes and these mistakes can be extremely costly or cause harm to others. This is why EO insurance is important.
This insurance can be known by different names. For example, in the field of medicine, is commonly called malpractice insurance while attorneys or other professionals in the legal field will usually have professional liability insurance. They are basically the same thing, they just provide coverage specific for their industry.
Making the assumption that is something you do not need can be a big mistake. Anytime a business works with other people or businesses, they are at risk. Errors that affect clients, employees or other vendors can open a business up for a lawsuit and having EO insurance can provide the protection needed.