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General Liability vs. Errors and Omissions Insurance

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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.

What is the difference between General Liability and Errors and Omissions insurance?

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.

What is General Liability insurance?

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.

What does General Liability insurance cover?

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:

  • Bodily injury: Someone other than an employee is physically harmed by an accident involving your workplace, equipment or employees.
  • Property damage: Someone else’s property is damaged in the course of your work.
  • Advertising injury: A person or business’s reputation or name is damaged. This is sometimes referred to as “personal injury.”

Learn more about general liability insurance coverage.

Who needs General Liability insurance?

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.

How much does General Liability insurance cost?

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.**

Learn more about general liability costs.

What is Errors and Omissions insurance?

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.

What does Errors and Omissions insurance cover?

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:

  • Professional negligence (actual or alleged)
  • Legal defense costs
  • Legal judgments

Learn more about errors and omissions coverage.

Who needs Errors and Omissions insurance?

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.

How much does Errors and Omissions insurance cost?

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.

How do General Liability and Errors and Omissions insurance overlap?

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:

  • Damage to third parties: These types of insurance don’t cover incidents involving your employees or your own property.
  • Accidental, not intentional, damage: Purposeful attacks and projects intentionally left unfinished aren’t covered.
  • Legal expenses: Like general liability, errors and omissions insurance helps with legal fees and court costs if you’re involved in a lawsuit.
  • Coverage territory restrictions: Incidents that happen outside a designated area aren’t covered.

Is Errors and Omissions insurance the same as General Liability?

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.

Do I need both types of insurance?

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.

How NEXT help small businesses find the coverage they need

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.

In addition to general liability insurance and errors and omissions insurance, we also offer workers’ compensation insurance, commercial property and business owner’s policy options.

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.

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Let’s find the coverage you need for your business

Business insurance is divided into different policies. We offer seven types so it's easy to design the coverage that fits your business.

General Liability insurance
General Liability

Protect yourself from accidents that cause physical injury or damaged property.

Professional Liability or Error and Omissions Insurance
Professional Liability/E&O

Shield yourself from lawsuits that claim your work errors caused financial losses.

Workers' Compensation Insurance
Workers’ Compensation

Cover medical bills and lost wages if your employees have an accident at work.

Commercial Auto Insurance
Commercial Auto

Stay on the road with coverage for dents, tows and damage to someone else’s vehicle.

Tools & Equipment Insurance
Tools & Equipment

Upgrade your general liability coverage to protect any gear that’s stolen, damaged or lost.

Commercial Property Insurance
Commercial Property

Keep your building, inventory and equipment protected from fire or water damage.

Business Owner’s Policy Insurance
Business Owner’s Policy

Combine general liability and commercial property into one policy to protect your business.

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* To the extent permitted by law, applicants are individually underwritten, not all applicants may qualify. Individual rates and savings vary and are subject to change. Discounts and savings are available where state laws and regulations allow, and may vary by state. Certain discounts apply to specific coverages only.
** The cost data presented here are based on NEXT active customers in the U.S. who purchased professional liability insurance over the previous 12 months. These data should not be considered a substitute for obtaining a quote specific to your business. These data were updated in July 2022.
*** The cost data presented here are based on NEXT active customers in the U.S. who purchased professional liability insurance over the previous 12 months. These data should not be considered a substitute for obtaining a quote specific to your business. These data were updated in July 2022.
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