What Is Errors And Omissions Insurance – Why Do You Need It?

Making errors and mistakes is often associated to what makes us human.  However, if you are working professionally and that part of your job is to provide accurate and error free work such as that of in banking, finances, accounting, and taxation management, your clients are basically employing your services expecting everything will go smoothly, accurately, in proper order, and with no mistakes made.  This is because any mistakes when it comes to numbers can have serious consequences at the final tally.  This inaccuracy due to an error or mistake made within the compounding of numbers can lead to a very serious situation since there is no telling if a gain or loss has been made.

For individuals and companies that are involved in such trade and profession, a serious mistake can be detrimental to their part and reputation.  In fact, they may likely even be sued by their client for the mistakes incurred by them which has led to variety of rippling effect on their business.  Since lawsuits are quite common nowadays involving errors and mistakes incurred by the professional, the professional can actually protect his best interest and his overall reputation without costing him money on the courtroom litigation process by getting insurance that provides coverage on such unintended errors on their part.

Errors and Omissions Insurance is a type of professional insurance protection that aims to protect and provide financial aid to the insured should they get sued under such cases.  If a professional dealing with numbers and money get sued without insurance, he will need to pay for all the expenses involved in his legal defense.  This will include lawyer’s fee, courtroom fees, and other expenses necessary for his defense.  Of course, if the court’s verdict finds his defense guilty of what has been accused of him, then he may also need to shell out money for the court-decided settlements.

To avoid any unnecessary expenditure on your part should you get sued by a client on reasons that have or have no grounds or merits at all, getting errors and omissions insurance may just prove to be an invaluable asset and investment for you.  After all, this insurance protection will be what sets you from losing significant amount of your hard-earned money to not having to worry about paying any serious money at all.