subject: Errors and omissions insurance to take care of sudden and unforeseen mistakes [print this page] Errors and omissions insurance to take care of sudden and unforeseen mistakes
Errors and omissions is one kind of individual or business liability insurance that can bail out a company or a person in situations where they are being sued for malpractice. Among the professionals that avail the service of this kind of insurance are insurance agents, architects, real-estate agents, physicians and lawyers. An omission or an error mistake can land a company or a person in severe financial trouble and in the worst cases, may cause them to lose all their financial assets. However, having a prior errors and omissions insurance will save them from an impending ruin as the high costs like hiring a defense attorney and other will be borne by the insurance company. Obtaining this kind of coverage along with other insurance policies is thus important for any business or individual.
An apparently small mistake can invite a total financial collapse of a company or an individual. Errors and omissions insurance however provide enough money to the accused to challenge any inappropriate claim brought against them. In many countries, this insurance is mandatory for companies whose main business comprises of doling advice to customers for money. It may often happen that a patient or a client sues a company for losses or damages that have not been caused intentionally and the company is not accountable for the losses. Under such circumstances, a company without the right coverage may run into deep trouble. Not only the lawsuit will be very costly to continue with, but the name and reputation of the company will take a bad beating, too. People often carry out good research before shifting their loyalty to such a farm and any kind of negative feedback may mean losing many potential future clients.
With increasing use of technology, there is greater risk of these mistakes taking place today than anytime before. A small mistake caused by a computer can end up in making a client lose a huge amount of money. In such cases, the client would certainly look for ways to recover his money and would sue the company. Similarly, in a hospital if the health chart of a particular person is lost or misplaced, the doctor attending the patient would be impaired from making a proper diagnosis which in turn, may lead to severe physical damage or even the death of the patient. These types of mistakes are more prone to happen in large businesses that handle a good number of employees and no matter whether caused through negligence or any kind of technological glitch, the company is sure to face a lawsuit for damages. Many think general liability insurance will take care of such expenses, but in most cases, they do not. It is thus necessary to have errors and omissions insurance to keep yourself protected from such unforeseen occurrence and expenses.
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