Errors and omissions insurance—also known as E&O insurance, indemnity insurance, or professional liability insurance—is a form of professional liability insurance designed to protect employers and employees against customers’ or clients’ claims of negligence or inadequate work. It protects your business if you are sued for negligently performing your services—even if you didn’t make a mistake or do anything wrong.

A customer could sue you because you did something you shouldn’t have, or you didn’t do something you should have, in the course of providing professional services.

For example, a freelance writer or consultant who creates marketing and information content for websites might be sued by a client who is sued for copyright infringement or forced to remove the content from their website because it infringes another person’s copyright. An E&O policy might protect the freelance writer or consultant from the claim they were negligent in creating the content that infringes another person’s copyright—paying the cost of defending the case and any settlement or court judgment in the matter, subject to policy limits.

Industries with service providers who often purchase E&O insurance include:

• Architecture and engineering

• Construction

• IT/technology

• Real estate (agents, inspectors, surveyors, appraisers)

• Consulting

• Marketing (graphic designers, web designers, photographers, event planners, promoters)

• Health and beauty

• Fitness (instructors, teachers, trainers)

• Retail

• Therapy

In Connecticut (CT), Errors and Omissions (E&O) insurance is a type of professional liability insurance that safeguards businesses and their employees from claims of negligence or substandard work by clients or customers. This insurance is particularly relevant for professionals who provide services or advice, as it covers legal costs and settlements or judgments if a business is sued for allegedly failing to perform their services properly, even if no actual mistake was made. E&O insurance is commonly purchased by service providers in various industries, including architecture, engineering, construction, IT, real estate, consulting, marketing, health and beauty, fitness, retail, and therapy, among others. While Connecticut does not mandate E&O insurance for all service providers, certain professionals, such as real estate agents and appraisers, may be required by law or industry standards to carry this insurance. It's important for businesses to assess their risk and consider E&O coverage to protect against potential legal actions arising from their professional services.