Professional Liability Insurance (E&O)
Professional Liability Insurance (E&O) covers economic damages for claims of liability that arise from errors, omissions, or negligent acts that professionals commit in the course of their provision of professional services. E&O either reimburses the insured or pays covered damages on the insured professional’s behalf and also pays for defense costs.
Professional liability is liability a person may incur for committing an error or omission (wrongful act) during the provision of professional services that causes harm to another.
Note that liability exists only when the professional is legally obligated for the loss suffered by another person because the professional has a duty to the person who suffered the loss, and the professional’s negligence was the proximate cause of that loss.
© PLUS 2017 -Professional Liability Insurance: Introduction.