Professionals can be sued for mistakes even when they act in good faith. Errors and omissions coverage, often abbreviated E&O, protects against claims arising from negligent acts, errors, or omissions in the performance of professional services. It is a form of professional liability insurance.

Typical buyers include insurance agents, real-estate brokers, consultants, architects, and technology service providers. The policy responds to claims for financial loss caused by the professional’s failure to meet the standard of care. Bodily injury and property damage are usually excluded and left to general liability policies.

Claims-made wording is standard, so timely reporting and awareness of retroactive dates are critical. Defense costs may be inside or outside the limit. Applications require detailed disclosure of services, contracts, and prior claims. The coverage is often a practical necessity for firms that clients will not hire without it.

• Professional liability for negligent acts or omissions
• Covers financial loss from professional services
• Usually written on a claims-made basis
• Essential for many advisory and service occupations