Professional Liability
Insurance (E&O)
When a client claims your professional advice or work caused them financial harm, professional liability insurance covers your defense and any settlement — even if you did nothing wrong.
What E&O covers
- Claims of professional negligence or errors
- Omissions — something you failed to do that caused harm
- Breach of professional duty
- Misrepresentation in professional services
- Defense costs even if the claim is groundless
- Prior acts coverage (with tail or retroactive date)
Who needs professional liability?
- Management consultants and business advisors
- Accountants and bookkeepers
- IT and technology service providers
- Architects and engineers
- Marketing and PR agencies
- Healthcare providers (medical malpractice)
- Real estate agents and brokers
- Any business providing advice or professional services
E&O questions answered
What is E&O insurance?
Errors & Omissions (E&O) is another name for professional liability insurance. It covers claims that your professional work caused a client financial harm — whether through an error you made or an obligation you failed to fulfill.
Does GL cover professional mistakes?
No. General liability specifically excludes professional services. A client who loses money because of bad advice or a project gone wrong needs to claim under your professional liability policy, not your GL.
Do I need it if I have a service contract?
Yes — contracts can't fully protect you from lawsuit exposure. Even with a strong limitation-of-liability clause, clients still sue, and legal defense alone can cost $50,000–$200,000.
What is a retroactive date?
The date from which your professional liability policy covers past work. Maintain an unbroken policy so your retroactive date goes back as far as possible — gap in coverage = gap in protection for past services.