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⚖️ '''Error and omission (E&O)''' is a form of [[Definition:Professional indemnity insurance | professional liability insurance]] that protects individuals and firms against claims alleging negligent acts, errors, or omissions in the performance of professional services. Within the insurance industry, E&O coverage carries particular significance in two directions: insurers and [[Definition:Reinsurance | reinsurers]] underwrite E&O policies for a wide range of professional classes (lawyers, accountants, architects, technology consultants), and insurance intermediaries — [[Definition:Insurance broker | brokers]], [[Definition:Insurance agent | agents]], [[Definition:Managing general agent (MGA) | MGAs]], and [[Definition:Third-party administrator (TPA) | TPAs]] — are themselves required to carry E&O coverage as a condition of licensure or market access in virtually every major jurisdiction. The term "E&O" is most commonly used in North American markets; in the United Kingdom and many international markets, the equivalent product is typically called [[Definition:Professional indemnity insurance | professional indemnity (PI) insurance]], though the underlying coverage concept is substantially similar.

🔍 E&O policies are almost universally written on a [[Definition:Claims-made policy | claims-made]] basis, meaning coverage responds to claims first made during the policy period regardless of when the underlying error occurred — provided it falls within the retroactive date. A typical policy covers defense costs, settlements, and judgments arising from allegations of professional negligence, but commonly excludes intentional misconduct, bodily injury, and criminal acts. For insurance intermediaries specifically, E&O claims often stem from failure to procure requested [[Definition:Insurance coverage | coverage]], misrepresentation of policy terms, failure to advise on adequate [[Definition:Limit of liability | limits]], or administrative errors that leave clients uninsured at the time of a [[Definition:Loss | loss]]. [[Definition:Underwriting | Underwriting]] E&O for intermediaries involves evaluating the firm's lines of business, revenue, claims history, internal quality controls, and compliance procedures. Regulatory bodies — including [[Definition:Lloyd's of London | Lloyd's]] for its [[Definition:Coverholder | coverholders]], state insurance departments in the U.S., and the Financial Conduct Authority in the UK — set minimum E&O coverage requirements that vary by role and market.

🛡️ Maintaining adequate E&O coverage is not merely a regulatory checkbox — it is a foundational element of professional credibility and client trust in the insurance distribution chain. When a [[Definition:Policyholder | policyholder]] suffers a loss that should have been covered but was not, due to a broker's or agent's mistake, the E&O policy serves as the financial backstop that makes the client whole. Without it, the intermediary faces personal or corporate liability that can be existential for smaller firms. For insurers writing E&O across professional classes, this line has grown in importance as the complexity of professional services increases and litigation trends expand the scope of actionable negligence. [[Definition:Cyber insurance | Cyber]]-related E&O claims — where technology firms face allegations that software defects or service failures caused client losses — have emerged as one of the fastest-growing segments, blurring the line between traditional E&O and technology liability coverage.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Professional indemnity insurance]]
* [[Definition:Claims-made policy]]
* [[Definition:Insurance broker]]
* [[Definition:Directors and officers liability (D&O)]]
* [[Definition:Cyber insurance]]
* [[Definition:Liability insurance]]
{{Div col end}}

Definition:Error and omission (E&O) - Revision history

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