While errors and omissions (E&O) insurance provides valuable protection for professional mistakes, it has its limitations. Here’s what it typically doesn’t cover:
1. Intentional Acts: Any harm caused by deliberate wrongdoings like fraud, deceit, or illegal activities won’t be covered. Insurance companies won’t back intentional misconduct.
2. Bodily Injury and Property Damage: Physical harm or damage to tangible property falls under general liability insurance, not E&O. Separate coverage is needed for these situations.
3. Data Leaks and Cyberattacks: Cyber liability insurance specializes in these areas. E&O typically focuses on professional negligence arising from services, not data breaches.
4. Pre-Policy and Post-Policy Occurrences: Claims based on errors before the policy’s effective date or after its expiry won’t be covered. E&O protects during the active policy period.
5. Contractual Disputes: Breaches of contract, disagreements over specific terms, or failure to meet contractual obligations might not be covered by E&O. Consult your policy wording for specifics.
6. Regulatory Fines and Penalties: Financial penalties imposed by regulatory bodies due to non-compliance or violations are generally excluded from E&O coverage.
7. Punitive Damages: In some cases, courts award punitive damages beyond actual compensation for harm. E&O policies often exclude coverage for such awards.
8. Reputational Damage: While E&O may cover defense costs for claims relating to reputational harm, it typically won’t directly compensate for loss of reputation itself.
9. Known Mistakes: If you were aware of an error at the time it occurred but chose not to rectify it, your insurance company might deny coverage for any resulting claim.
10. Specific Exclusions: Each E&O policy may have specific exclusions listed. Carefully review your policy document to understand what’s not covered in your particular case.
Remember, this is a general overview. Specific exclusions and coverage details can vary depending on your policy and insurance provider. Always consult your insurance company or an insurance broker for comprehensive information about your E&O coverage and its limitations.
