E&O Insurance - Who Needs It? How is it Different from General Liability?

Описание: Our insurance carrier expert presents valuable information on Errors & Omissions coverage. You will become a professional at teaching your insureds the difference between E&O and General Liability as well as be able to explain to them why Errors & Omissions Insurance is important for them. Our carrier expert also goes over a few different E&O claim examples so you know what those look like!

Timestamps:

00:00 Start
02:16 General Liability
05:46 What is a Professional?
08:14 Legal Foundation for Errors & Omissions
15:44 Who needs Errors & Omissions Coverage?
22:00 What does an E&O claim look like?
35:22 Summing up the difference: GL vs E&O

Basic General Liability Coverage:
Bodily Injury and Property Damage as a result of the organization’s operations
Personal & Advertising Injury
Products/Completed Operations

Exposures Probably Covered with GL (but not limited to):
Slips, trips and falls at organization’s premises
Property damage to others property as a result of the organizations activities
Libel or Slander as a result of organization’s communications
Selling or providing of goods to the public
Damage to Premises Rented

Other GL Covered Exposures (Maybe):
Abuse or Molestation during organization’s activities and events
Errors or omissions resulting from the organization’s professional services
Hired and/or Non-owned automobiles used for the organizations needs
Off-premises operations or activities
Special Events hosted by the organization
Host Liquor Liability

Exposures NOT Covered with General Liability:
Automobile, Watercraft Liability
Worker’s Compensation and Employer’s Liability
Liquor Liability
Pollution
Employment Related Practices (CG2147)
Data Breach (CG2107)

The following endorsements may appear on your General Liability policy which can exclude or significantly reduce coverage:
Abuse or Molestation Exclusion
Premises Limitation Endorsement
Classification Limitation Endorsement
Professional Services Exclusion

So, what is a Professional?
Talent
Livelihood
Intellectual Ability v. Physical Skill
Specialized training, education, continuing education
Licensed, certified, regulated by state and/or professional organizations

A "Professional" has a special skill, knowledge, training, judgment and/or expertise.

Examples: doctors, dentists, lawyers, architects, insurance agents, real estate agents, accountants or consultants.

"Professional Services" can be defined as services performed by an Insured, usually for a fee.

Let's sum up the difference between General Liability (GL) and Errors & Omissions (E&O):

E&O Liability is designed to insure professional services rendered for a fee involving alleged economic damages, unrelated to bodily injury or property damage to a third party.

If the business owner’s primary services rendered concern is bodily injury or property damage resulting from exposures, they would look for a broad form General Liability policy form designed to cover their specific exposures.

When reviewing a potential clients business exposures,  it is important to look at all types of services performed and determine whether it is a GL or E&O exposure.  So many companies are diversifying and it can be challenging to determine what their true exposure is.  Ask the question, what do you see as your greatest exposures that you would like to insure for?

Have questions? Reach out to us at [email protected]

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CID Insurance Programs is an E&S Wholesaler specializing in commercial insurance products designed for independent and captive insurance brokers’ business client’s needs.

Our wholesale business insurance products encompass a broad range of preferred to manageable hard-to-place risks. CID Insurance has developed strong relationships with both admitted and non-admitted markets. Our commitment is to make the quote and bind process fast and easy for our retail insurance brokers.