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Insurance covers for professional errors


Error and negligence are made easily but understanding the impact of the error/omission is necessary for a professional. Negligence and faulty service affect the third party and  disturb the confidence reposed in a professional by the  receiver of service whether from a doctor, dentist, lawyer, architect etc.

Errors & Omissions  insurance protects companies and professionals against claims of inadequate work or negligent actions made by clients. Companies often obtain E&O insurance if they provide services to a customer for a fee.

Professional liability insurance, also known as Errors and Omissions (E&O) coverage, is to protect businesses against claims from customers. Claims that arise due to the  professional advice or services  provided and which caused  financial harm to the customer due to actual or alleged mistakes or a failure to perform a service.


What E&O insurance covers

Damages resulting from professional liability arising out of negligence of duty or faulty service of the  professional

Law firms, architects and engineers or engineering firms, and it companies can land themselves in a professional liability situation due to deviation in the expected outcome of their service. 

Take an example of a property dispute between two siblings brother and sister.While the brother wanted to keep the father’s  property to himself the sister demanded her share of property and things took an ugly turn and reached the court.

The counsel for the brother contented that daughters are not eligible for the father’s self earned property.The sister contested the case with an expert Counsel and the Court ruled the case in favor of the sister and the brother lost his case.

The brother sued his counsel who appeared on his behalf at the court for professional error. He opined that  counsel who appeared at the  court had misguided him without studying the legal aspects correctly and not updating himself on the previous case judgements of the similar kind,which led to his losing the case in the  court.These professional errors and negligence are paid under the insurance policy.


Intellectual property or copyrights claims: Any original article, material,scientific invention is a copyright which means the contents or whole of it cannot be used to be printed and published under one's name without the original writers/owners/innovator’s permission. It is a copyright of the original creator. Copyright act protects the original ,creative /innovative work .

Such an act is an infringement of copyright act.The authors/copyright owners can take legal action against a person or entity using /printing publishing  their copyrighted content without permission and is unauthorized. The copyright owner can file a civil case in a court and is entitled to damages and reprieve.

Defamation: Defamation is  when something damaging is said /presented and hurts the original person/individual  who is defamed. We have ample examples of such defamation dialogues in the election season.

Libel  and slander: Libel and slander are both types of defamation. Libel is an untrue written  statement that is defamatory. Slander is an oral statement that is untrue and defamatory. Libel is some untrue statement made in writing in articles /newspapers. Slander is usually done in the media and is spoken.

Damages for defamation, libel and slander  if claimed by the aggrieved party are paid and insurance policy covers such liabilities.

What E&O insurance does not cover

Criminal prosecution – any act committed with criminal intent is not covered by insurance policies as it is contrary to law.

Legal Liability towards the customers,third parties is absolute and the person who has obtained such services  is entitled to damages, and compensation.Various insurance policies are designed to protect the service provider from such claims.


We at Zen insurance assist in choosing the right Insurance cover to suit your needs. Please contact us  for  assistance.


 Disclaimer:    

Zen Insurance Brokers is an IRDAI registered broker which facilitates quick & accurate insurance broking services. We deal with only regulator approved products of insurers. We do not underwrite the products.

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