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Business Insurance

Professional Liability (E&O)

Accountants, architects, attorneys, consultants, designers, financial planners, insurance agents, mortgage brokers, physicians, property managers, real estate agents, title agents, and other professionals provide their clients with their expertise and advice. This advise, acted upon by a client, can be very beneficial to an organization or it can cause the organization or individual to experience loss.  To protect the professional in the event of a loss based upon this advise, there is Professional Liability.


Professional Liability, more commonly known as errors and omissions (E&O insurance), is a special type of coverage that protects your company against claims that a professional service you provided caused your client to suffer financial harm due to mistakes on your part (errors) or because you failed to perform some service (omissions). 


Examples of Professional Liability Claims:

 

  • A travel agent is hired to book a family vacation. As the trip nears, the travel agent realizes they booked the wrong week. The family is unable to go on the vacation during the booked week because of scheduling conflicts. The family sues the travel agent for the money they paid for airline and hotel reservations.*
  • An advertising agency is hired by a toy company to promote a new toy for the holiday season. One of the designers misrepresents a feature of the toy in the materials created. The toy company sues the advertising agency for lost revenue because they weren’t able to fully market the toy during the holiday season.*
  • A court reporter receives a letter from an attorney demanding transcripts from a deposition they did a week ago. The court reporter realizes the transcript was accidentally deleted from their hard drive. The court reporter discloses the error and is sued by the attorney for costs to have the witness deposed again.*


General liability insurance would not respond to any of these situations, a professional liability policy specific to each industry would be where coverage can be found.


Professional Liability policies are specific to each industry and must be written correctly.  There are many things to consider including retroactive dates, anniversary rate dates, extended reporting, acquisitions, and mergers when purchasing your policy.  Foundation Insurance Services has the expertise and knowledge to help you find the right policy for your organization.


For questions or additional information give us a call. (480) 999 -2088 


*credit The Hartford Insurance Company

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Professional Liability, more commonly known as errors and omissions (E&O insurance), is a special type of coverage that protects your company against claims that a professional service you provided caused your client to suffer financial harm due to mistakes on your part (errors) or because you failed to perform some service (omissions). 

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