The Error and Omissions Insurance Policy or Professional Indemnity (PI) insurance is a particular type of professional liability insurance policy that protects individuals or companies against claims made by clients for negligent actions or inadequate work. Claims made by clients can go up to the specified amount as per the contract or in terms of financial loss actually incurred. Protection under these types of claims can be availed under Professional Indemnity Insurance or Errors and Omissions Insurance based on the business operations of the insured entity.
Professional Indemnity (PI) is more suited for physical services being done such as Contractors, Doctors, Lawyers, Architects etc. An E&O Insurance is more suitably drafted for IT firms.
Insurance coverage provides a certain type of insurance protection that helps to safeguard against any untoward event if and when your client holds you responsible for making mistakes that cost them money.
These accusations may comprise claims that your work was unprofessional, inadequate or incomplete, careless conduct or simply not as desired by your client. You must keep in mind that even if you have never made a mistake; you could still be sued. Any organisation would realise that a discontented client blaming your service for their financial loss might sue you or your company, and the subsequent impact it could have on the company’s financials. Your PI or E & O insurance coverage can help you defend your business in many important ways. It covers both court expenses and any settlement amount, subject to the overall indemnity selected. It is a form of professional liability insurance, which protects the business from claims of negligence, errors, misrepresentation, omissions, inaccurate advice, personal injury to third parties, or violation of good faith and fair dealing.
Only civil liability claims are payable under this insurance policy, such as negligence of the insured person thereby resulting in injury or death to any third party or their property or more commonly financial losses. It may be noted that the liability arising out of any criminal act or violation of law is not covered under this insurance.
Scope of our services
The benefits of the Error and Omissions Insurance Policy depends on the issuing Insurance company and their understanding of the risk. Hence a correct representation of the business operations, systems and process that are in place to mitigate risk etc are crucial in not only determining a correct premium but also when claims are incurred.
Our Financial Liability team helps clients of this policy garner benefits from this policy to its full potential. We tend to ensure overall financial benefits to professionals/organizations insured under this policy. Our team does a thorough risk evaluation at the proposal stage so that a proper representation of the customers business is done with the underwriters. This includes the following activities: