Frequently Asked Questions

Errors and omissions insurance coverage, also known as professional liability insurance, provides protection for your professional services business from claims of negligence or failing to perform your professional duties. It also covers the cost of defending against a negligent claim made by a client. The coverage focuses on alleged failure to perform on the part of, financial loss caused by, and error or omission in the service or product sold by the policyholder.

The primary reason for professional liability coverage is that a typical general liability insurance policy will only respond to a bodily injury, property damage, personal injury or advertising injury claim. But various professional services and products can give rise to legal claims without causing any bodily injury, property damage, personal injury or advertising injury. Common claims that professional liability insurance covers are negligence, misrepresentation, violation of good faith and fair dealing, and inaccurate advice.

Claims-made policies provide coverage for claims only when BOTH the alleged incident AND the resulting claim happen during the period the policy is in force. Claims made policies provide coverage so long as the insured continues to pay premiums for the initial policy and any subsequent renewals. Each succeeding year the policy is continuously renewed, the "coverage period" is extended. Once premiums stop the coverage stops. A claims-made policy is one where in order to have coverage, you must have a policy in force at the time the claim is made against you. If you choose to either non-renew or cancel your policy, the insurer will not recognize future claims (as of the cancellation or expiration date) as your policy will not be in force.

Most professional, errors and omissions (E&O), directors and officers (D&O), and employment practices liability insurance (EPLI) is written as claims-made policies.

An Occurrence policy protects you from any covered incident that "occurs" during the policy period, regardless of when a claim is filed. An occurrence policy will respond to claims that come in - even after the policy has been canceled - so long as the incident occurred during the period in which coverage was in force.

All professional liability insurance policies are written on a claims made basis. As mentioned earlier for a claim to be covered, the policy must be in place at the time of a loss. If you cancel or let your policy expire and a claim due to your professional work is made, the individual professional and the firm will not have coverage at that time. If you plan to shut down or sell your business you will need to purchase coverage through an "Extended Reporting Period" or "ERP". An ERP policy will cover your business for the 1, 3, 5 or however many years you purchase it for if a loss were to happen.

Your annual insurance policy is generally referred to as a practice policy. A project specific policy is a policy placed by the project owner, protecting the interests of all the parties involved in a construction project. As a landscape architect it is important to know how your annual policy (practice policy) will respond in the instance where you are named as an insured on a project policy. Many times, you will not be informed that you are named on this type of policy. Project specific placements typically start with a base deductible of $100,000 and can be as high as $250,000. If you were at fault during any part on this project policy, you would be on the hook for part or the entire deductible amount. Our Aon product has a deductible infill feature which would protect you from paying the deductible and shall indemnify you for the difference from your Aon policy deducible.