Friday, June 27, 2014
The management consultancy
industry is a tight battlefield in the business world. Some companies
may have consultants like you on their payroll to help make the
organization a better place for everyone. However, even the best
consultants out there can commit some errors with serious
consequences to follow. As such, management
consultants must have themselves covered by an errors and
omissions (E&O) business insurance policy.
Also known as professional
liabilities insurance, E&O policies are designed to cover your
legal fees in case you are sued for mistakes you made on the job that
affected your clients. These will include misrepresenting facts,
improper documentation, deleting vital information, or violating a
non-disclosure agreement (through acts such as leaking insider
material, for example). The policy will also cover any compensation
to the clients if the case worked in their favor. Take note that E&Os
are different from general liability insurance, which only covers
bodily harm or property damage if an incident involving you or your
employees happened at your client’s office.
Some consultants may argue
the need for E&O coverage if your client is happy with your work.
Still, like with other insurance types like homeowners insurance,
some events may still happen that are just out of your control. You
will need E&O policies to keep your business protected.
