Importance of Having E&O Insurance for Insurance Agents 

E&O insurance is a type of liability insurance that protects professional advice and service providers against allegations of negligence or professional mistakes. An E&O policy covers legal fees associated with the claims and other court-related expenses such as costs of hiring an attorney. 

As an insurance agent, you face a high amount of risk. You are expected to provide the right coverage to your clients at the right time. Not only that, but they also need to process all the paperwork correctly and provide exact payments to their carriers as well. 

E&O insurance for insurance agents covers a wide range of expenses. These costs will be paid up to the limits of a specific policy in the event of a lawsuit. An E&O policy will generally cover costs like: 

1. Attorney fees: At the time of facing an E&O claim from your client, you will need an attorney to represent you. Even if the case doesn’t go well in court, you still have to pay an attorney to back you up. So, having an E&O policy will help you get a lawyer to defend you in court. 

2. Court costs: After you get sued by a client for E&O, you need to reserve a courtroom where the hearings will take place. If your case goes on for days, then you will need to pay a lot of money until the lawsuit is settled. 

3. Administrative costs: An E&O policy also covers the costs of gathering necessary documents. Documents to be presented in court might be, written testimonies, business contracts, medical records, etc. 

4. Judgments and settlements: In a situation, if you lose a case, you need to pay the client who sued you in the first place. Without E&O insurance, in a severe case, this can result in your business being bankrupt.

Apart from these costs, having E&O insurance for insurance agents will ensure they get extensive ethics and compliance guidelines as per your industry regulations. You can also be provided an insurance claims adjuster who will negotiate with the plaintiff and track the progress of your case.