Insurance is the reasonable transfer of the threat of a loss, from insured one to another who provides insurance in exchange for charges and payment. It is risk management tool basically used to be precautions against the risk of a contingent, uncertain loss. Various types of insurance are available depending upon type and kind of risk covered by insurance.
Errors and Omissions Insurance is insurance related to accountability associated with burden of business of the professionals. This is a separate coverage from a standard general liability or property insurance policy. Errors and Omissions Insurance is also termed as E&O, E&O Insurance, Errors Omissions, Insurance, Errors & Omissions, Professional Liability, Professional Liability Insurance, and Malpractice insurance for legal and medical professionals, Professional Liability Insurance etc.
Errors and Omissions Insurance essentially protects companies and individuals against law suits for compensation claims filed by their own clients. It is intended for helping out professional from payments incurred during legal cases and defense overheads including the damage caused due to an error or lapse resulting inadequate work or negligent actions in providing by the Professional Services. An error or mistakes can crop up on any transaction in any profession causing financial harm to the client.
Errors and Omissions Insurance covers both costs incurred due to court fees, defense overheads including the damages caused and any settlements up to the amount specified on the insurance contract. E & O Insurance policy defines professional, which can be covered, as someone who possesses special awareness and skill necessary to render that specific professional service and is responsible to the legal, ethical or technical requirements of a given profession. Examples of professional are real estate agents and brokers, insurance agents, real estate agents and brokers, architects, professional engineers, attorneys, third party administrators, quality control workers, NDE Persons, and other business professionals.
It is also important to note that there are many businesses that have E & O Insurance coverage even though they are not considered professional practices. For example, advertising agencies, public relations firms, internet service providers, claims adjustment companies, market research companies, property management companies, mortgage bankers, web hosting companies, staffing agencies comprising of executive recruiting.
E&O Insurance can be obtained by insurance brokers/dealers, registered investment advisers and financial planners, among others. It is often required by regulatory bodies such as FINRA or company investors.
Premium for Errors and Omissions Insurance depends on type of professional services, jurisdiction state of services, 
annual revenues, number of professionals providing services, loss / claims history and policy type. While deciding the insurance provide one has to notice trend analysis data and financial modeling capabilities; national and international insurance carrier relationships, geographical limitations, proprietary benchmarking data, terms of coverage terms, limits, retentions and premiums.
