Why do I need Errors and Omissions Insurance?

Posted 1 year ago

I regularly work with successful business owners and entrepreneurs who have built their companies by providing in depth knowledge to others. Often their businesses involve direct consulting with a client, making educated recommendations, designing solutions, or represents the needs of others. Anytime you are involved with giving advice, there is always a chance for error during the process.

The story below is a perfect example of how a simple error could have turned into a potential financial hardship for the business owner.

Tracy, the owner of an Ontario-based event planning firm, was hired to provide event management services to a trade association holding its annual convention in Toronto.

During the course of the event preparation, errors were made in the advertising flyers sent to the convention attendees. The flyers incorrectly listed the speaking times and topics, making the flyers unusable. All of the flyers had to be reprinted and resent to the attendees, generating substantial additional costs in printing and postage.

The trade association sought to hold Tracy liable for the losses, and they filed a lawsuit against her and her event planning firm. But Tracy had an errors and omissions (E&O) liability policy, which she purchased when she started her company a few years ago.

Tracy’s E&O policy was written to cover service errors, contract performance disputes and defence costs. Therefore, the costs of the lawsuit brought against Tracy’s company were covered by her insurance policy, saving Tracy a lot of money in litigation costs.

Computer consultants, software developers, home inspectors, sales consultants, management consultants, business coaches, HR consultants, interior designers are all prime candidates for carrying E&O insurance.

If you think you would benefit from E&O coverage, let’s schedule a call to discuss your needs.

Email me at: steve@mollerinsurance.com

 

 

Posted in Business Insurance

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