Unfortunately everyone makes mistakes. So for this reason to protect businesses and the people who work in these businesses, errors and omissions insurance is available as part of your business insurance portfolio.
Errors and omissions insurance is also referred to as E & O insurance or malpractice insurance. Professionals who may benefit from E & O insurance include doctors, dentist, chiropractors or real estate agents. E & O insurance should be included in a businesses portfolio at the earliest stage possible. E & O Insurance will cover the business and the individual if a case comes to court.
Errors and omissions insurance should be considered mandatory for any professional that does work for clients. When an error on the part of the company can cause damage to a client, the company should have this coverage.
There is no standard for E & O insurance. Each practice is different and will require different insurance needs. An insurance company underwriter will assess the practice and what work is undertaken at the premises and supply a policy that will cover all the practice’s needs. These policies are written on a claims made and reported form, meaning that any claims must be made and reported within the time of the policy. Claims that arise out of the policy date will not be covered. When applying for a policy an insurance underwriter may want to view the businesses quality control procedures, documentation practices and training procedures and if you have had any previous claims.
Each business is very different, so upon applying for E & O insurance an insurance underwriter will need to go through the business to check of previous claims held again the business and what training procedures, documentation procedures and the companies quality control procedures exist, to be able to create the best suited policy for that business.
A business owner needs to work with their insurance underwriter so that they are offered the best priced policy that will cover them if an incident was to occur. When an errors and omissions insurance policy is put into place a business needs to make sure that they keep their business running well, to make sure their procedures are all in place and that all employees understand these procedures. With this insurance policy in place the business does not want to lower their standards as the threat of a malpractice claim could put the business and individuals into bankruptcy or the business may have to close down.
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