Errors and omissions insurance (E&O) covers claims of negligence in professional services, including advice or consultation that you carry out for a client.
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What is errors and omissions insurance?
Errors and omissions (E&O), also known as professional indemnity insurance, is designed to protect you from the cost of lawsuits and compensation if a client believes you've made a mistake or you've been negligent in your professional services. If you handle data or intellectual property belonging to your clients, this type of cover is often a contractual requirement.
10% of customers paid £9.08 a month or less for their errors and ommissions insurance between July and September 2022.
Errors and omissions insurance covers the legal and compensation costs if a claim was made against you for:
- Professional negligence
- Copyright infringement
- Reputational damage
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What does errors and omissions insurance cover?
If a client believes that you've made a mistake that's caused them to lose money, they may refuse to pay you and threaten to make a claim. If this happens and you have E&O cover, we will pay your owed fees and help to settle the dispute.
For most of us, reputation is a key element of ongoing success. Our cover provides public relationship and crisis management, to help protect your brand and reputation when things go wrong.
Intellectual property infringement
With today's rate of content creation, your chances of accidentally breaching copyright and intellectual property (IP) are increasing. With our cover, you're not only covered for your mistakes, but we'll pay up to £25,000 in legal costs defending your business from others.
A quick guide to E&O insurance
What is the difference between errors and omissions cover and professional indemnity insurance?
In short, nothing! E&O cover is the same as professional indemnity insurance, but just called a different name. Errors and omissions insurance is a term that's more widely used in the US, while professional indemnity insurance is more common in the UK. Errors and omissions insurance covers the same things as professional indemnity insurance, and you'll often see 'errors' and 'omissions' referenced in your professional indemnity policy.
Who needs errors and omissions insurance?
If you offer advice, consultancy or services, such as design, it's recommended that you buy errors and omissions insurance. Having E&O cover could even help you win more business as it’s often requested by clients before entering a contract.
What risks does errors and omissions insurance cover you for?
If a third party loses money as a result of your advice, consultancy or service, E&O insurance would cover the compensation and legal costs. Our E&O insurance covers you for:
- Copyright/trademark infringement
- Design flaws
- Erroneous advice
- Wrong allegations
- Negligent content
- Product disparagement
- Financial loss from business downtime
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Errors and omissions claims
There are various different types of E&O claims that can affect different industries, but here are a few examples of claims where the business could be liable:
As a graphic designer, you incorporate a design element which another artist claims is a copy of their work and they sue you.
A surveyor produces a flawed report for a property developer and is sued for the costs of rectifying the architectural drawings and the delay in construction.
Breach of confidentiality
A consultant accidentally passes on unencrypted confidential information from a client and the client’s financial records are compromised or exposed.
How do claims work?
You make a claim
Log in to your online account and go to the ‘Make a claim’ section. There, you can make a claim directly – there's no need to call us.
We'll ask you for some details about your claim, including a crime reference number (if applicable), the date of loss or claim made against you, type of claim and its detailed description.
You can also attach any relevant supporting documentation like proof of loss, proof of purchase, a letter of demand or a statement of claim.
We'll get on the case
Once submitted, your claim will be assessed.
If the claim is large, we may need more information from you. Or, if it's small, our team may be able to settle it within a couple of days (or hours, in some cases).
Either way, we'll keep you regularly updated and you'll be able to see the status of your claim on our customer portal.
Your claim is settled
After it's been assessed, we'll let you know if your claim has been successful or not.
If items have been lost, stolen or damaged, we might arrange for the items to be replaced or make a payment to you.
If you’re liable for something we will assist you with legal support.
Errors and omissions insurance FAQs
Errors and omissions insurance, also known as E&O, is another name for professional indemnity insurance. It provides cover for legal and compensation costs associated with mistakes (hence 'errors') made in your professional services that cause your client to lose money.
If you provide professional services or advice, errors and omissions cover will form an important part of your overall business protection package. It's not a legal requirement, but the cover it provides could mean the difference between survival and bankruptcy in the event of a claim.
The cost of errors and omissions cover will vary from business to business. Broadly speaking, factors impacting the cost will include: the value of contracts your business enters into; the risk level of work involved; and the location of your business.
Superscript's E&O cover starts from £9.08 per month.
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Authorised by the FCA
The FCA supervises UK financial services firms to protect consumers. We are directly authorised and regulated by the FCA and our Firm Reference Number is 656459. These details can be confirmed on the Financial Services Register at www.fca.org.uk or by calling the FCA on 0845 606 1234.
A-rated financial strength
Our insurance products are underwritten by Standard & Poor’s A-rated financial strength or higher. This means the underwriter has been independently assessed by the world’s leading credit rating provider and found to have a strong capacity to meet financial commitments (pay claims).
Protected by the FSCS
If you are a business with an annual turnover under £1m, charity with an annual income under £1m, or trust with net assets under £1m, then you will be entitled to compensation from the FSCS in the unlikely event we cannot meet our obligations. Full details and further information on the scheme are available at www.fscs.org.uk.