Professional Liability Insurance
Any company or organization that provides professional service to others for a fee or other consideration has an exposure to litigation. You may face allegations such as failing to perform the service, performing services that result in errors, or providing inaccurate or incomplete information. The damages claimed are usually of an "intangible" economic nature. Such economic losses are usually not covered by your General Liability or other commercial insurances, which are designed to cover physical loss or bodily injury claims.
Commercially available errors and omissions policies can provide broad and affordable coverage. For instance, many E&O insurance carriers provide $1 million policy limit coverage for the majority of the exposures listed above for as low as $3,000. A company's annual revenue and class of business can affect the pricing of these policies. Other factors that have an impact on pricing include network and Web site security, the caliber of contracts with customers/clients, and whether the company's Web site includes intellectual property safeguards.
The internet provides unique opportunities to reach ever-growing numbers of potential clients and customers, and it also presents modern litigators occasion to give their creative impulses free reign. Online systems, databases, chat rooms, bulletin boards, e-mail, and the internet are examples of current exposures for today's businesses. Companies need coverage for libel and slander, invasion of privacy, infliction of emotional distress, and copyright and trademark infringement—not to mention coverage for errors and omissions in the Insured's professional services that are delivered via the web.