Errors & Omissions Liability Insurance (E&O)
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At a Glance
Errors & Omissions Liability coverage can help protect your firm's assets from the costs associated with lawsuits alleging errors and omissions on the part of your firm or its registered representatives. This coverage may also significantly assist with legal defense costs for covered professional services.
Exposures and Risks
Without adequate Errors & Omissions Liability Insurance, your firm and its
representatives could be at risk from the following:
Client Suits - An investor seeking reimbursement from an individual broker and the firm, may claim the investment was misrepresented or a trade was not properly executed.
Capital Depletion - Securities firms are required by the SEC to maintain a minimum net capital requirement position as outlined in SEC Rule 15C3-3. A successful client suit, if substantial, could impair the firm's ability to comply with the rule and thus maintain its operation.
Personal Assets - Registered representatives of securities firms are often not entitled to indemnification from the firm, and in many instances are required to make the firm whole for losses incurred by their actions. Having E&O insurance protects your representatives, provides a unified defense and preserves the working relationships between the registered representatives and the firm's management.
Defense Cost Expenses - Legal costs associated with a defense in litigation and/or arbitration can be substantial. Large amounts of time and money can be spent on claims no matter what their outcome.
Client Suits - An investor seeking reimbursement from an individual broker and the firm, may claim the investment was misrepresented or a trade was not properly executed.
Capital Depletion - Securities firms are required by the SEC to maintain a minimum net capital requirement position as outlined in SEC Rule 15C3-3. A successful client suit, if substantial, could impair the firm's ability to comply with the rule and thus maintain its operation.
Personal Assets - Registered representatives of securities firms are often not entitled to indemnification from the firm, and in many instances are required to make the firm whole for losses incurred by their actions. Having E&O insurance protects your representatives, provides a unified defense and preserves the working relationships between the registered representatives and the firm's management.
Defense Cost Expenses - Legal costs associated with a defense in litigation and/or arbitration can be substantial. Large amounts of time and money can be spent on claims no matter what their outcome.
E&O Liability Insurance can protect your firm against financial loss from the following claims:
- Failing to supervise a registered representative.
- Recommending an unsuitable investment.
- Failing to effect a transaction in a timely manner.
- Giving insufficient notification on a margin call.
- Violating a client agreement.
- Failing to inform regarding the impact of the tax laws on a recommended security.
How to Apply
Our goal is to provide you with the most comprehensive coverage at the most reasonable price with the least amount of work for you.
Get started today by requesting a no-obligation analysis of your firm's E&O exposure by completing our brief Eligibility Questionnaire. Our Insurance Specialists will research the market for the best coverage and rates for your firm to choose from.
AR Ins. Lic. #245544
CA Ins. Lic. #0633005
d/b/a in CA Seabury & Smith Insurance Program Management
Get started today by requesting a no-obligation analysis of your firm's E&O exposure by completing our brief Eligibility Questionnaire. Our Insurance Specialists will research the market for the best coverage and rates for your firm to choose from.
AR Ins. Lic. #245544
CA Ins. Lic. #0633005
d/b/a in CA Seabury & Smith Insurance Program Management
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