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Professional Liability Insurance/Errors and Omissions Insurance

Your company is sued for malpractice; your employees are accused of causing a major software crash that results in a huge financial loss for a client or your subcontractors overseas fail to meet the terms of the contract. To protect your firm from these and other potentially catastrophic law suits and court judgements you need professional liability/errors and omissions insurance. Commercial general liability insurance does not cover professional liability, errors, omissions or contract disputes.

Professional liability/errors and omissions insurance covers you, your partners, your employees and your subcontractors, usually worldwide (as long as the suit is brought in the United States). Two major areas of coverage are: malpractice for failing to maintain accepted standards of care as a professional or company and breach of contract. Policies cover legal defense costs, court costs and court judgements against you up to the limits of your coverage. A personal injury rider gives coverage against claims of slander, libel and invasion of privacy. You can take out additional coverage to protect you from allegations of copyright and intellectual property infringements. The terms of your contract or your investors may require you to have professional liability and errors and omissions insurance.

When selecting an insurer and a professional liability/errors and omissions policy, check the coverage, exclusions and limitations carefully to make sure that your type of work and likely exposures to risk are covered. Policies can be customized to meet the needs of your business, the individuals and responsibilities covered and the length of coverage.

Mistakes happen and circumstances can make it impossible for you to meet the terms of your contract. With potentially lengthy legal processes and large court judgements, a professional liability and errors and omissions insurance policy protects you from malpractice, breach of contract or error and omissions suits which can make the difference between your firm’s financial survival or bankruptcy.