How is Commercial General Liability Different from Errors and Omissions
Liability protects your company from accidents that result from outside influence. Errors and Omissions protect you from liability that can arise due to mistakes you or one of your licensed employee’s personally makes.
General liability insurance protects you from a number of different types of potential risks and hazards in your day to day business life. It’s there to help when accidents occur unexpectedly. If a customer hurts themselves while they’re in your business establishment for example, general liability covers the cost of paying for the necessary medical treatments or paying settlements when applicable.
General liability can provide coverage for bodily injuries, so that when people hurt themselves inside your business premises their medical expenses are covered. It also pays for property damages, such as when a customer’s car is damaged in your business parking lot. coverage also protects you against lawsuits and legal action when people believe you have harmed their character, such as through slander or defamation. Liability coverage also protects rented office and retail spaces, in the event that you cause damage or destruction to the property.
Errors and Omissions insurance is protection for professionals that offer guidance, advice and specialized types of care. When professionals make mistakes that cost their clients money or cause them to lose valuable property, those clients may sue the company for damages. Errors and omissions coverage protects you from having to handle the litigation and settlements out of pocket.
If an accountant makes a mistake with decimal point placement on an income tax return for example, his customer may find themselves having to pay much more money to the IRS than they should have. This mistake is a direct result of a professional error and it caused financial harm to the client.
Other professionals can make mistakes that cause harm or damage as well. A pet groomer can accidentally use shampoo on a dog that causes it to have a severe allergic reaction. An electrician can forget to install a circuit and the customer’s house could catch fire. A mechanic can forget to tighten an oil filter and as a result, all of the oil drains out of the engine and it seizes up and no longer works.
Errors and omissions insurance is also known as professional liability coverage. It protects you from losses that can be a direct result of mistakes you or an employee made. General liability coverage is separate commercial insurance that protects you from a number of potential accidents, risks and hazards that you may have no direct control over.
