Miscellaneous Professional Liability, (synonymous with the term errors and omissions (E&O) liability insurance), results from errors or omissions in the performance of professional services. Miscellaneous Professional Liability has the briefest history of any professional liability class. There are usually no specific policy forms covering the non-traditional profession and generally the underwriter uses a generic policy form to which is attached any necessary forms defining the specific exposure. The application form is considered a part of the policy and fully describes the nature of the risk insured. There are several reasons for the significant increase in the number of businesses being exposed to claims involving economic loss not directly connected to bodily injury and property damages.
  1. The nation’s transformation to a service/information-oriented economy from manufacturing has spawned the development of various professions or quasi-professions that were either unknown or non-existent 20 years ago.
  2. An increasingly litigious society that has placed enhanced performance standards on those whose operations rarely gave rise to claims alleging economic loss from negligent performance of services.
  3. The explosive growth of the consulting profession has fostered the development of occupations that require professional liability insurance;
  4. Businesses are demanding with increasing frequency that firms and individuals they employ present evidence of professional liability coverage.
Companies that perform professional services for others can make mistakes, overlook a critical piece of information, misstate a fact, be misunderstood, forget to do something, misplace something, etc., and be sued by their clients over allegations, such as:
  • Error, omission, or negligence in providing a service.
  • Failure to provide a service.
  • Fraud.
  • Improper documentation.
  • Malpractice
  • Mismanagement.
  • Misrepresentation of facts.
  • Nondisclosure.
  • Violations of state and federal law.