1. Errors and Omissions Insurance/Professional
Liability
Some businesses involve services such as giving
advice, making recommendations, designing things,
providing physical care or representing the needs
of others, which can lead to being sued by customers,
clients or patients claiming that the business's
failure to perform a job properly has injured them.
Errors and omissions or professional liability insurance
covers these situations. The policy will pay any
judgment for which the insured is legally liable,
up to the policy limit. It also provides legal defense
costs, even when there has been no wrong-doing.
2. Employment Practices Liability Insurance
Employment practices liability insurance covers
(up to the policy limits) damages for which an employer
is legally liable such as violating an employee's
civil or other legal rights. In addition to paying
a judgment for which the insured is liable, it also
provides legal defense costs, which can be substantial
even when there has been no wrong-doing.
3. Directors and Officers Liability Insurance
Directors and officers liability insurance protects
directors and officers of corporations or not-for-profit
organizations if there is a lawsuit claiming they
managed the business or organization without proper
regard for the rights of others. The policy will
pay any judgment for which the insured is legally
liable, up to the policy limit. It also provides
for legal defense costs, even where there has been
no wrong-doing.
4. Key Employee Insurance
Life or disability income insurance can compensate
a business when certain key employees die or become
disabled. These coverages cushion some of the adverse
financial impact that results from losing a key employee's
participation.
5. Umbrella Policies
As the name implies, an umbrella liability policy
provides coverage over and above a business's other
liability coverages. It is designed to protect against
unusually high losses. It provides protection when
the policy limits of one of the underlying policies
have been used up. For a typical business, the umbrella
policy would provide protection beyond the general
liability and auto liability policies. If a company
has employment practices liability insurance, directors
and officers liability, or other types of liability
insurance, the umbrella could provide protection
beyond those policy limits as well.
