Errors and omissions policy forms vary from carrier to carrier and all have their own list of exclusions.
Claims related to criminal, fraudulent, or dishonest act are normally excluded. Claims related to any type of liability which was assumed by the insured under a contract are also excluded. Another important exclusion relates to the insolvency or bankruptcy of an insurance carrier with which business was placed, unless such carrier had a certain AM Best rating when the business was placed (such as A- or better, or B+ or better). Other common exclusions include fee disputes, fines, penalties, sanctions, and disciplinary proceedings. You should always review the entire policy, including the actual exclusions and limitations, before binding your errors and insurance coverage.
While local or state laws may or may not expressly require some types of professionals to carry E&O coverage, other laws regarding their duty of care to clients make it a necessity. Additionally, you should seriously consider errors and omissions coverage if your business provides a professional service or regularly gives advice.
Here’s just a couple of the 5 questions:
I was showing a property and my client tripped and fell. Is that covered under my E&O policy?
Do I really need to protect my real estate firm against cyber theft and fraud?