E&O insurance covers claims arising from professional mistakes, negligent acts, omissions, misrepresentation, or failure to meet contractual obligations in the delivery of services.

This includes:

• • Missed deadlines

  • Incorrect advice or recommendations

  • Administrative or clerical errors

  • Failure to deliver services as agreed

  • Defense costs, settlements, and judgments

Even if the claim is baseless, legal defense expenses are typically covered. In many policies, defense costs are included within the policy limits, meaning they reduce the total available coverage.

Any professional who provides advice, expertise, or services for a fee should strongly consider E&O coverage.

Common professions include:

• • Lawyers

  • Consultants

  • Accountants

  • Real estate professionals

  • Insurance brokers

  • IT professionals

  • Architects and engineers

If a client could suffer financial loss because of your work, you are exposed to potential liability—even if you did nothing wrong.

E&O policies generally do not cover:

• • Intentional wrongdoing or fraud

  • Criminal acts

  • Bodily injury or property damage (covered under general liability)

  • Employment disputes (covered under EPLI)

  • Cyber incidents (unless specifically endorsed)

It’s important to review exclusions carefully, as policies vary by industry and insurer.

Most small businesses in Ontario carry:

• • $1 million per occurrence (minimum common standard)

  • $2 million aggregate

  • Higher limits (e.g., $5 million) for construction, manufacturing, or higher-risk industries

The appropriate limit depends on:

• • Industry risk level

  • Contractual requirements

  • Size of projects

  • Customer exposure

  • Asset protection strategy

Many commercial landlords in Ontario require at least $2 million in liability coverage.

Coverage limits depend on:

• • Your industry

  • Contract requirements

  • Revenue size

  • Risk exposure

  • Client expectations

Common limits start at $1 million per claim, but higher-risk industries may require $2 million or more. It’s also important to consider aggregate limits, deductibles, and defense cost structures when selecting coverage.

A proper risk assessment helps determine the right balance between affordability and protection.