Top X Errors and Omissions Insurance Policies to Consider
As the old saying goes, we humans cannot live without making mistakes in our lives. While it may sound acceptable informally, mistakes done by professionals are not easy to handle. Professionals do make mistakes, be these related to negligent actions, inadequate services offered, or others. However, some clients or end-consumers create legal problems for the professionals who’ve work with them, be these a doctor, lawyer or an architect.
For example, a client may file a case against his investment advisor after his investment advice results in losses, even if the related risks have been pre-shared.
In such situations, Errors and Omissions (E&O) insurance plays a vital role. It is a form of professional indemnity insurance that protects professionals against claims related to the services they offer. It covers the legal fees or court costs as well as the settlements as per the guidelines of the insurance policy. Also, you can buy this professional indemnity insurance online or offline.
In general, the risk of claims made against professionals varies from one profession to the other, and so do the benefits of E&O insurance. Let’s dig deeper to know about the top four E&O insurance policies:
Professional Indemnity Insurance for Doctors
Professional Indemnity insurance plan for doctors can safeguard them financially against legal costs and compensation claims raised by patients. In case a mishap happens while a doctor is offering treatment, the patient or his family can file a legal case against him and ask for compensation of a desired amount. However with the help of this insurance, a doctor can avoid concerns of paying the compensation asked by a patient or the legal costs involved.
As per the policy guidelines which may differ from one insurer to another, the insurance coverage also varies. At times, it is quantified based on the impact on the lives of affected patients. In some cases, the victims expect substantial monetary compensation, which would become unviable if a doctor does not have this insurance.
Directors and Officers (D&O) Liability Insurance
This type of liability insurance is aimed at the directors and senior managers in all organisations, no matter small or big. As per the employment hierarchy, the directors are at the top and are thus exposed to litigations or lawsuits from diverse stakeholders. To keep them safe and protected, organisations buy D&O liability insurance for them. It ensures that the personal assets of the directors and officers are not at stake, while offering other benefits. One can buy this type of professional liability insurance online or offline through an insurance broker.
Professional Indemnity Insurance for Lawyers
Just like doctors, lawyers can also be sued by their clients for negligence, errors, and omissions committed on their part. The cost of dealing with such lawsuits can be hefty, which requires them to buy professional indemnity insurance.
However loss or damages caused to the victims arising from wilful neglect or deliberate acts are generally excluded as per the insurance policy guidelines. Often large organizations buy this liability insurance for their lawyers, or lawyers can buy it themselves. The choice of adequate coverage depends on the risk perception of the insured and the regions of operation.
Liability Insurance for Chartered Accountants (CAs)
Chartered Accountants, whether working individually or with a law firm, may face situations wherein the clients sue them for negligent services offered. For protective coverage against claims for actual or alleged failures, CAs should buy this professional liability insurance either online or offline. It also covers defense costs wherever incurred while dealing with lawsuits. The possibility of income loss from business interruption can also get covered under this insurance.
No professional wants to hurt their clients willingly. However, errors or mistakes can happen unintentionally but can lead to significant losses. To avoid facing these losses as a professional, you are advised to buy E&O insurance.
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