LIABILITY INSURANCE
Errors and omissions insurance (E&O) definition
Errors and omissions insurance is professional liability cover that protects professionals against claims arising from mistakes, negligence or inadequate work.
In practice, this means a type of cover that insures professionals against liability incurred as a result of mistakes or negligence in their professional conduct. Errors and omissions is essentially professional indemnity insurance. This gives insurers, brokers, reinsurers and risk managers a shared way to discuss the concept when reviewing policies, claims, regulation or market data.
This term is especially useful in relation to liability insurance, claims handling and policy wording. The term helps assess legal responsibility, claim response and protection against third-party or employee claims. It also helps users compare how insurance is structured, regulated, priced or claimed across different markets.
Errors and omissions insurance (E&O) is closely related to professional indemnity, professional liability, negligence and liability insurance. Linking these concepts together helps build a clearer glossary structure and gives readers a stronger understanding of how individual insurance terms connect within wider international insurance practice.
At a glance
- Used in
- Liability insurance, claims handling and policy wording.
- Purpose
- Helps assess legal responsibility, claim response and protection against third-party or employee claims.
- Important because
- Clear definitions support better comparison of insurance products, market practices and regulatory requirements across jurisdictions.
- Related terms
- professional indemnity, professional liability, negligence and liability insurance.
Example of errors and omissions insurance
A consultant gives advice that causes a client financial loss. Errors and omissions insurance may cover the resulting professional negligence claim.