Should I Get Errors & Omissions Insurance?

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Posted Oct 4th, 2018

Should I Get Errors & Omissions Insurance?

Errors and omissions insurance is a kind of commercial liability coverage. Here, the Youngs Georgetown team discusses what it covers, and whether you need it.

Errors and omissions insurance protects your business against claims that may arise as a result of negligence of some kind on your part, or if you fail to provide the level of service or advice that the plaintiff expected.

It is also sometimes called malpractice or professional liability insurance.

Almost any business that performs a service or offers advice for a fee may have professional liability exposure, and could benefit from errors and omissions insurance.

Types of Errors & Omissions Policies

The Youngs Georgetown team can tailor your errors and omissions policy to suite your specific business. Different basic plans already exist for specific industries, and these can be tailored, but if none exists for yours, we can build one for you.

While each errors and omissions policy will be a bit different, The following are some common features they often share:


Most of the time, errors and omissions policies are claims-made. This means they cover claims made during the policy period. However, some only cover claims that are both made and reported to the insurer during the policy period, so this is worth paying attention to.

Your errors and omissions policy will likely include a retroactive date, which means it will cover you against claims made on or after that date.

Insuring Agreement

An insuring agreement is a statement that outlines what the insurer is prepared to do in exchange for the premium you pay. Typically, it states that the insurer will pay for damages or a settlement that you are required to pay as the result of a wrongful act.

The term ‘wrongful act’ typically refers to a negligent act, an error or an omission that you have allegedly committed while performing your professional services.

The insuring agreement is important because it outlines what, exactly, is covered in your policy. You may also find this information in the declarations portion of your policy.

However this information is presented, the Youngs Georgetown team will talk you through the document, and make sure you understand each piece.


One of the most important elements to errors and omissions insurance policies is defence coverage. This means that your insurance will cover your legal defence against any covered claims. If this is not included in the policy, you would have to pay all legal fees out of pocket.


The exclusions outlined in the errors and omissions policy are what it does not cover. Some common exclusions include:

  • Punitive damages
  • Criminal acts
  • Wrongful acts you were aware of before the policy began
  • Bodily injury
  • Discrimination based on sex, race, etc.

Your Youngs Insurance Georgetown broker will make sure you understand all the exclusions in your policy, and that you’re protected exactly the way you need to be.

Limits & Retention

Your policy will describe both individual and aggregate limits. The individual limits describe the most the insurer is willing to pay for damages or settlements arising from a single claim or wrongful act.

The aggregate limits describe the most that the insurer will pay out altogether during the whole of the policy period.

Retention is a type of deductible. It is the amount you must pat yourself for each claim.

If you think you might benefit from errors and omissions insurance, contact the Youngs Georgetown team today for a free quote!

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