Many people are wondering what e & o insurance (errors and omissions) insurance is, and why they need it. This is basically coverage for a professional that pays for their court fees if a customer sues them. The people who most often use this coverage are doctors, lawyers, architects, and home inspectors, just to name a few.
Obviously, mistakes happen regardless of how good at your profession you are. In most instances, you will be sued for failing to live up to your promises to the customer, but in some cases, it can happen, even if you have fulfilled your agreement. In either case, errors and omissions coverage is imperative.
As far as what it covers, it generally pays for lawyer expenses, and also any money you are forced to pay from losing the case. In addition, most companies that provide this coverage will also give you a list of attorneys who specialize in the errors and omissions field. Most regular lawyers are not equipped to handle it, and therefore using the company’s lawyers will save you time from finding a good lawyer yourself.
One argument some professionals make is that they have an LLC (limited liability corporation) and therefore do not need e & o insurance. However, even if you do, the company assets of the firm are still at stake. In addition, if there areno assets, the customer can legally come after the directory of the firm and their assets.
As far as what will determine the monthly premium, it really depends on how long you have been in business, and how many cases you have filed against you in the past. The main thing you want to do is proof that you have a history of not being sued. If a company sees that you have been sued 10 times in the past year, your premiums are going to be very high.
To find the best rate, make sure you get a number of quotes prior to committing to someone. This is the fastest and easiest method to just make sure that you avoid going through a broker. It is possible to use them to get many quotes. However, once you figure out which insurance company is the cheapest, and then be sure that you cut out the middleman and go directly to the company’s website. This way, you avoid paying the expensive broker fees.
Also, be sure the company you are considering has a good financial track record. Otherwise, you might be paying your monthly premium faithfully, only to find the company goes bankrupt when you need a claim. One fast method to find the top company is to just ask other people in your profession whom they use. This is how to find the best e & o insurance quickly and effortlessly.
