Best Life Insurance Company That Doesn’t Require Errors and Omissions in 2022
Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina.
He has also earned an MFA in screenwriting from Chapman Univer…
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Written by
Jeffrey Johnson
Insurance Lawyer
Benjamin Carr was a licensed insurance agent in Georgia and has two years’ experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.
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Reviewed by
Benji Carr
Former Licensed Life Insurance Agent
UPDATED: Apr 5, 2022
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The Facts of Life
Errors and omissions insurance is a type of professional liability insurance that protects a company, its workers, and other professionals against any form of claims made by a client with regard to any negligence, malpractice, or inadequate work
E&O insurance might not be necessary for every business. It is essential to identify the risks involved in the business to decide if you need to purchase E&O insurance or not
Many insurance carriers offer E&O insurance for insurance agents. You can compare multiple quotes and choose the one that suits you and your business the best
Every business, despite putting in a lot of effort, has a possibility of making mistakes. Sometimes these mistakes can cause harm to the customers and bring a suit against you and the business. These risks and mistakes can cost you your client. In such situations, Errors & Omissions insurance can come to your rescue and help cover the costs associated with lawsuits and other services to protect your business.
Let us dive deeper into understanding more about E&O insurance, its importance, the companies that offer E&O insurance at affordable rates, and companies that do not require E&O insurance.
Understanding Errors & Omissions Insurance
Errors and omissions insurance is one of the most important business insurance policies that a business must have. E&O insurance is a vital form of protection for companies functioning in several types of industries.
What is errors and omissions insurance?
Errors & omissions insurance protects a company, its workers, and other professionals against any form of claims made by clients because of any negligence, malpractice, or inadequate work on the company’s part. E&O insurance is a type of professional liability insurance.
E&O insurance is targeted towards specific companies that offer certain types of services like consultation, financial advice, or legal advice. Hence, E&O is not a necessity for all companies and industries.
How does it work?
At a very basic level, errors and omissions insurance is an agreement between two parties, the policyholder and the insurer. The policyholder pays the insurer premiums in return for coverage against certain types of lawsuits. E&O insurance has some similar elements like regular insurance including premiums, deductibles, coverage, and policy limits.
Premiums are the regular payments made by the policyholder to the insurer for retaining the policy. Deductibles are the amount of money that the policyholder pays for a claim before the coverage comes to action. If the policyholder agrees to pay a higher deductible, insurers offer a lower premium rate. The maximum amount paid by the insurer under the terms of the policy is referred to as the policy limit.
Coverage
Errors and omissions insurance is similar to liability insurance, wherein it covers the entire costs of a claim made by a client against the company or any professional working in the company. It generally covers courts costs and settlements up to the specified amount in the contract. E&O insurance helps cover the damages and the fees associated with the legalities.
How much does it cost?
The premiums of errors and omissions insurance are highly dependent on the characteristics of a specific business and hence the cost can vary from one provider to another. Various factors like the type of industry, the company size and revenue, company history and experience, business location, coverage limits and deductibles, and the claims history matter when it comes to the cost of the policy.
According to The Hartford, the average cost for E&O insurance can range from $500 to $1,000 per employee per year.
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Significance Of E&O Insurance
For your business to grow and progress, it is essential to understand the risks involved and be ready for all possible situations. While working with individual clients, you must protect your company and yourself as an insurance agent with errors and omissions insurance. This insurance covers claims made by a client against negligence or inadequate work actions like defective products, faulty services, delivery delays, or financial loss to the client.
Errors and omissions insurance protects the worker and the company against minor mistakes that can have serious claims and huge consequences. Even if these are honest mistakes, they can compromise on clients and also cost the agency a fortune. When it comes to insurance companies, E&O insurance can help protect the client’s reputation and the insurance business.
Ways to Save On the Cost of E&O Insurance
One of the most common things to do to save on the cost of E&O insurance is by avoiding claims and choosing a higher deductible. You can also consider certain factors while purchasing a policy that can help you save some bucks yet fulfill your requirements.
Compare Quotes
Different insurance companies offer different policy quotes. Some might even customize a policy depending upon the industry, or even specialize in specific industries. You must compare quotes from different providers and choose a policy that has a balance between the coverage and cost, and a company that offers you maximum coverage and protection with minimum premiums. Keep in mind the level of risk involved in your business.
Work With an Agent Who Is Aware of Your Business
Working with a knowledgeable agent who is aware of the liabilities involved in your industry can offer you better policy options that will fit your budget and also fulfill the risks. An experienced agent can help you choose or skip add-ons, help you set appropriate limits, and also recommend endorsements that match your risks. They can help you get a clear idea of whether or not a policy is offering you enough coverage.
Keep Your Claims History Clean
Similar to auto insurance, the claims on your E&O policy can make your premium rates go higher. If you have a lengthy claims history, insurance companies might become reluctant to insure your business. Make sure that you communicate properly and have detailed contracts with your clients to avoid any misunderstandings and disagreements.
Choose Higher Deductibles
Generally, a higher deductible means a lower premium. You can consider a higher deductible if you are concerned about unlikely but expensive claims. In case a claim occurs, the amount you pay as the deductible might be insignificant in comparison to the coverage of the policy. Although, smaller losses that are less than your deductible may not get covered at all.
Best Life Insurance Companies That Offer E&O Insurance for Less
Several life insurance companies offer errors and omissions insurance for insurance agents at affordable rates. We recommend comparing multiple quotes from insurance providers to choose the one that is the best for you. But if you’re looking for the best E&O insurance for insurance agents, the following are a good place to start.
Hiscox
Hiscox is best known for offering affordable E&O insurance rates to real estate agents, property managers, and brokers.
Pros
The policies are tailored to suit more than 180 industries.
The policy coverage is internationally available.
The company offers affordable rates and easy online quoting.
The payment schedules are flexible and do not have any additional charges.
Cons
The company is not financially strong in comparison to other competitors.
Customer support is only available by phone.
The company offers tailored policies depending upon the industry and profession.
AIG
AIG offers policy options for every type of industry including aerospace, healthcare, hospitality, construction, transportation, and education.
Pros
The Reputation Guard coverage pays for various services if the business gets involved in a major lawsuit and also protects the brand identity after the lawsuit.
The company sells all standard insurance products alongside unique policies.
Cons
Do not offer general liability insurance.
You can get a quote only by contacting an agent.
The company is known as the best overall professional liability insurance provider.
Thimble Insurance
Thimble Insurance is known for offering affordable and flexible professional liability insurance which is a great option for small businesses and their changing coverage needs. The policies are available for individuals from different professions such as pet sitters, freelancers, event managers, beauty professionals, janitors, and fitness professionals.
Pros
The policy coverage is available in a variety of different term lengths.
The policies are affordable starting at $36 per month.
It has flexible policy terms and payment options.
Cons
The company does not support online claims.
The policies are not available in every state.
The policies are suitable for individuals from various professional backgrounds, such as pet sitters, freelancers, event managers, beauty professionals, janitors, and fitness professionals.
Progressive Corporation
Progressive offers customized commercial insurance policies including E&O insurance for a variety of different professions.
Pros
The company offers online quoting.
It has affordable premiums starting at $46 per month.
The policies can be bundled up with other commercial policies.
Cons
The policies are not directly underwritten by Progressive.
The policies are not available in every state.
Progressive Corporation offers affordable rates, easy bundling options, and a convenient user experience.
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Life Insurance Companies That Do Not Require Errors and Omissions Insurance
Some insurance carriers require the agents to have E&O insurance coverage, whereas some carriers do not require it. Here is a list of life insurance companies that do not require errors and omissions insurance from insurance agents:
Aetna
Cigna
American Equity Investment Life Holding Company
Bankers Fidelity Life Insurance Company
Mutual Of Omaha
Capitol Life Insurance Company
Central States Health & Life Co. of Omaha (CSO)
Manhattan Life Insurance Company
Royal Neighbors Of America (RNA)
In most cases, insurance companies offer different policies based on the needs of their clients. Agents present these coverage options to their clients based on what the providers offer. Before making an offer, agents must have errors and omissions insurance coverage for their protection as well as the protection of the agency that they represent.
Final Verdict
Purchasing errors and omissions insurance is necessary for the protection of you and your business, depending on the risk factors that are involved in your industry. You can always devise a plan for your business that prevents errors and omissions in your field. On the other hand, you can also look for insurance carriers that offer E&O policies at affordable rates which suit your business needs without burning a hole in your pocket. Compare the best insurance policies and quotes on Life Insurance Post to find one that suits your needs.
References:
https://www.thehartford.com/professional-liability-insurance/errors-omissions-insurance/costs
