If you don’t know the difference between general liability insurance vs. errors and omissions insurance (E&O insurance), you’re not alone.
While some people have heard these terms before, many don’t know exactly what each type of insurance covers. If you’re a business owner or hope to become one soon, it’s a good idea to familiarize yourself with both.
If you’re looking to compare errors and omissions vs. general liability, you’ve come to the right place.
But first, some housekeeping: This article references errors and omissions coverage for industries outside of construction trades. NEXT also offers contractors errors & omissions insurance, which has some unique modifications to address the needs of construction businesses.
General liability insurance and errors and omissions insurance apply to different types of risks faced by most businesses.
Errors & omissions insurance can help cover financial losses after work mistakes. General liability insurance can help cover medical expenses after accidental injuries to non-employees and property damage for property you don’t own.
There can also be significant differences between E&O insurance vs. general liability in terms of premiums. General liability and errors and omissions insurance costs are determined on a case-by-case basis depending on a variety of factors for each business.
General liability insurance provides financial protection for some of the most common types of accidents that can occur at a business. This includes slip-and-fall accidents and injuries to people who are not your employees.
It can also help pay for repairs or a replacement if you damage property that doesn’t belong to your business.
Many business owners get general liability insurance because of its broad coverage for common accidents.
You can be held financially responsible if an accident involves your business. General liability insurance can provide coverage for business risks that fall within these categories:
Learn more about general liability insurance coverage.
Most businesses need general liability insurance. Because it covers so many basic risks, it’s typically one of the first policies included in business insurance packages.
In most cases, state laws don’t require general liability insurance. However, clients may ask businesses to provide proof of this insurance coverage.
General liability insurance can cost as little as $11 per month. However, the exact price you’ll pay depends on several factors, including your business location and what type of work you do.**
Errors and Omissions insurance (E&O) offers protection for professional mistakes.
It’s known as professional liability insurance in some industries.
E&O can help business owners defend themselves against lawsuits and negligence claims if they are accused of making an error in their work.
Whether you actually make a mistake or a client just thinks you did, the outcomes can be costly. Fortunately, E&O insurance can help cover related expenses when business disagreements arise.
Errors & Omissions insurance covers legal expenses or defense costs when a client claims that a business made work errors that caused them to lose money.
Some of the specific costs covered by E&O or professional liability insurance include:
Learn more about errors and omissions coverage.
Businesses buy E&O coverage because it helps cover unexpected expenses if they’re accused of making professional mistakes. Additionally, some clients require businesses to carry it before they’ll work with them.
The cost of E&O insurance can be as low as $18.34 a month. Keep in mind that a number of factors can influence the final cost of these insurance premiums.**
Learn more about how much E&O insurance costs.
There is technically no overlap between general liability and errors and omissions.
However, when comparing E&O vs. general liability, you’ll find that both types of insurance provide coverage for unexpected accidents and situations.
Clients may require general liability and E&O insurance before agreeing to work with you. Some commercial landlords and licensing organizations also require proof of coverage.
Some of the similarities in coverage for commercial general liability insurance and errors and omissions insurance include:
No. Although both are types of liability insurance, they are not the same type of policy. When looking closer at errors and omissions insurance vs. general liability insurance, you’ll find that they don’t cover the same types of incidents.
The answer to this question depends on the type of work you do.
Having both types of insurance can be a good idea for many businesses. With general liability and E&O coverage, you’re more protected against a wide range of potential accidents and unforeseen expenses.
At NEXT, we make getting the right insurance for your business easy. Our affordable general liability and E&O insurance policies help protect you when accidents and mistakes happen on the job.
We create customized, affordable insurance packages for business owners all over the country.
When you start a quote, we’ll ask you a few questions and suggest the most relevant insurance policies for your needs.
In just minutes, you can review your options, purchase the coverage you want and download a certificate of insurance.
Get your instant insurance quote today.
Business insurance is divided into different policies. We offer seven types so it's easy to design the coverage that fits your business.