E&O (Errors and Omissions) insurance primarily protects which party?

E&O (Errors and Omissions) insurance primarily protects which party?

• A. Insurance agents
• B. Insurance clients
• C. Insurance companies
• D. Regulators

Answer: (A)

Errors and Omissions insurance is professional liability protection for the people who provide expert services. For an insurance agent, this means coverage if a client sues over alleged mistakes, such as faulty advice, misrepresentation, or errors in issuing or handling a policy. The policy helps pay defense costs and any settlements or judgments up to the agreed limit. It’s designed to shield the agent from liability arising from their professional work, not to protect clients, regulators, or the insurer itself from liability. It also excludes intentional fraud or willful wrongdoing.

Errors and Omissions insurance is professional liability protection for the people who provide expert services. For an insurance agent, this means coverage if a client sues over alleged mistakes, such as faulty advice, misrepresentation, or errors in issuing or handling a policy. The policy helps pay defense costs and any settlements or judgments up to the agreed limit. It’s designed to shield the agent from liability arising from their professional work, not to protect clients, regulators, or the insurer itself from liability. It also excludes intentional fraud or willful wrongdoing.