Errors & Omissions Insurance

Pricing varies significantly by profession, revenue, limits, deductible, and claim history, but rough ranges for a small firm (under $1M revenue, no prior claims) with $1M/$1M limits: Management or HR consultants: $1,000–$2,500/year Accountants / bookkeepers: $1,200–$3,500/year IT consultants / small MSPs: $1,500–$4,500/year (tech-E&O usually bundled with cyber) Marketing agencies / designers: $1,000–$2,500/year Architects / engineers: $2,500–$7,500/year (significantly higher for design-build) Financial advisors / RIAs: $1,500–$5,000/year

Generally, pure breach-of-contract claims are excluded from E&O — they’re considered contractual liability, not professional negligence. However, the same set of facts often gives rise to both a breach-of-contract claim and a professional negligence claim (the client argues you failed to perform the contract AND that the failure was due to negligence). When the complaint pleads negligence alongside contract claims, E&O typically responds at least

Tail coverage — formally called the Extended Reporting Period (ERP) — extends the time during which claims can be reported under a claims-made policy after the policy ends. You typically need tail coverage when: you retire and discontinue practice, you sell or close the business, you switch to a different carrier without retroactive-date continuity, or you convert from claims-made to occurrence (rare). Tail coverage is purchased once, at

E&O is written on a claims-made basis, which means coverage responds to claims first made against you during the policy period — even if the work happened years earlier — as long as the work occurred after the policy’s retroactive date. By contrast, occurrence-based policies (which is how GL is usually written) respond based on when the injury occurred, regardless of when the claim

For most professions, E&O is not state-mandated — it’s required by client contracts, professional licensing bodies, or industry standards rather than by law. Exceptions where law or regulation effectively mandates it: registered investment advisors and broker-dealers (SEC/FINRA expectations), title agents under state title-insurance regulations, and several professional categories where the state licensing board requires proof of E&O for license renewal. Real estate

General liability (GL) covers bodily injury and property damage caused to third parties — a client tripping in your office, a delivery vehicle damaging a client’s loading dock. Errors & omissions (E&O) covers financial harm caused by professional service failures — a missed tax deadline, faulty advice, a botched software implementation, an inaccurate appraisal. Most professional services firms need both. GL doesn’t cover professional mistakes; E&O