Protect your business from claims of negligence, errors, and omissions. Buffer Insurance is an independent brokerage — we shop multiple carriers to find the right E&O policy for consultants, tech firms, accountants, and every professional service business.
Get a Free E&O Quote →Professional liability insurance — also called Errors & Omissions (E&O) — protects businesses and professionals from claims alleging that their professional services caused a client financial loss. Unlike general liability, which covers physical injuries and property damage, professional liability covers the financial harm caused by your work product, advice, or failure to perform.
Whether you are a consultant who gave advice that led to a client's loss, a software developer whose code caused a system failure, or an accountant who missed a tax deadline, professional liability insurance pays for your legal defense and any resulting settlements or judgments. Even groundless claims require a legal defense, and E&O coverage ensures that defense does not come out of your pocket.
E&O insurance provides protection across the full spectrum of professional service risks. Here are the five core coverage areas.
Covers claims that you failed to exercise the standard of care expected in your profession. If a client alleges that your work fell below professional standards and caused them financial harm, E&O pays for your legal defense and any resulting damages.
Covers claims arising from actual mistakes in your professional work — incorrect calculations, flawed designs, coding errors, or factual inaccuracies in reports. Even careful professionals make mistakes, and a single error can trigger a significant claim.
Covers claims alleging that you failed to do something you should have done — missed a filing deadline, forgot to include critical information, or failed to warn a client about a known risk. Omissions are among the most common professional liability claims.
Pays for attorney fees, court costs, expert witnesses, and other litigation expenses. Professional liability claims are often complex and expensive to defend. E&O covers your defense even if the claim is completely without merit.
Covers claims that you made inaccurate statements, provided misleading information, or misrepresented your qualifications or the scope of your services. Even unintentional misrepresentation can lead to significant claims.
E&O insurance is specifically designed for professional service risks. These common exclusions are covered by other policies that Buffer can help you find.
Physical injuries to people and damage to tangible property are covered by general liability insurance, not professional liability. E&O covers financial losses from your professional services, not physical harm.
Deliberate fraud, criminal acts, and intentional harm are excluded from all insurance policies. E&O covers honest mistakes and unintentional negligence, not willful misconduct.
Claims from your employees — wrongful termination, discrimination, harassment — are covered by Employment Practices Liability Insurance (EPLI), not professional liability.
While some E&O policies include limited cyber coverage, full protection for data breaches, ransomware, and regulatory fines requires a standalone cyber liability policy.
Claims you were already aware of before purchasing the policy are excluded. E&O covers unknown future claims, not pre-existing disputes or situations you knew could lead to a claim.
Any business that provides professional advice, services, or expertise to clients needs E&O coverage. If clients pay you for your knowledge and judgment, you need protection when that judgment is questioned.
Software developers, IT consultants, managed service providers, and SaaS companies face claims when their technology fails, projects are delayed, or systems do not perform as promised.
Accountants, bookkeepers, financial planners, and tax preparers are exposed to claims from calculation errors, missed deadlines, and advice that results in financial losses for their clients.
Design professionals face claims when their plans contain errors, structures do not perform as designed, or projects exceed budgets due to design changes. Many states require E&O for licensed architects and engineers.
Management consultants, HR advisors, marketing consultants, and business coaches are liable when their recommendations lead to client losses. Contracts often require proof of E&O coverage before engagement.
Licensed agents and brokers face claims when transactions go wrong, coverage gaps are missed, or clients allege they received bad advice. Most states require E&O as a condition of licensure.
Professional liability policies are typically written on a claims-made basis with per-claim and aggregate limits. Here are the standard coverage levels and cost factors.
| Limit Type | Typical Amount | What It Means |
|---|---|---|
| Per Claim | $1,000,000 | The maximum the insurer pays for any single claim, including legal defense and settlement or judgment costs. |
| Annual Aggregate | $1,000,000 – $2,000,000 | The total maximum the insurer pays for all claims combined during the policy period. |
| Deductible | $1,000 – $10,000 | Your out-of-pocket cost per claim before the insurer begins paying. Higher deductibles lower your premium. |
| Retroactive Date | Varies | The earliest date for which prior acts are covered. Claims-made policies only cover incidents occurring after this date. |
| Extended Reporting | 1 – 3 Years | Tail coverage period available when canceling or switching carriers, allowing claims for past work to be reported. |
Architects and financial advisors pay more than marketing consultants due to higher claim frequency and severity in their industries.
Higher revenue indicates more client engagements and greater exposure. Revenue is the primary rating basis for most E&O policies.
Prior claims significantly increase premiums. A clean claims record demonstrates professionalism and lowers your risk profile with carriers.
Newer businesses often pay slightly higher rates. Established firms with proven track records may qualify for experience discounts.
The size of your client contracts affects your exposure. Higher-value projects mean larger potential claims and higher premiums.
Higher limits cost more. Choosing a higher deductible can reduce your premium while still providing protection against catastrophic claims.
These two policies protect against completely different types of risk. Most professional service businesses need both. Here is how they compare.
| Feature | Professional Liability (E&O) | General Liability (GL) |
|---|---|---|
| What It Covers | Financial losses caused by your professional services — errors, negligence, omissions, and misrepresentation. | Physical incidents — third-party bodily injury, property damage, personal and advertising injury. |
| Claim Trigger | A client claims your work or advice caused them financial harm, even if you did nothing wrong. | Someone is physically injured or their property is damaged due to your business operations. |
| Policy Type | Almost always claims-made. Covers claims reported during the policy period regardless of when the incident occurred. | Almost always occurrence-based. Covers incidents that happen during the policy period regardless of when the claim is filed. |
| Who Needs It | Any business that provides professional advice, consulting, design, technology, or skilled services. | Virtually every business that interacts with the public, clients, or operates a physical location. |
| Example Claim | A client sues because your consulting advice led to a failed product launch and $200K in lost revenue. | A client trips over a cable in your office and breaks their arm, requiring surgery and rehabilitation. |
Straightforward answers to the questions we hear most from professionals and business owners evaluating their E&O coverage.
Professional liability is one piece of a complete business insurance program. These policies address other risks your professional practice faces.