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 South Carolina, Errors and Omissions (E&O) insurance is a type of professional liability insurance that serves to protect businesses and individuals who provide professional services from claims of negligence or inadequate work. This insurance is particularly important for professionals who could be held liable for errors, omissions, or negligence in the course of their work, even if no mistake was actually made. E&O insurance can cover legal defense costs, settlements, and court judgments up to the policy limits. While there is no specific state statute in South Carolina mandating E&O insurance for all service providers, certain professions may be required by law or industry standards to carry such insurance. For example, real estate professionals, including agents and appraisers, are often required to have E&O insurance as part of their licensing requirements. It's advisable for professionals in the listed industries, such as architecture, engineering, IT, consulting, and others, to consider obtaining E&O insurance to mitigate the financial risks associated with potential legal claims. An attorney specializing in insurance law can provide more detailed advice tailored to individual circumstances and ensure compliance with any applicable regulations.