How Much Does Errors & Omissions (E&O) Insurance Cost?
Simply Business customers pay a median price of $42 per month for Errors & Omissions (E&O) insurance. Your actual E&O insurance cost will depend on the type of work you do, your location, workforce, policy limits, and claims history.
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What is Errors & Omissions (E&O) Insurance?
Errors & omissions (E&O) insurance — also known as professional liability insurance — can help protect your small business from honest mistakes and errors.
As a professional, you’re great at what you do, but no one gets it right 100% of the time. Whether it’s a typo in a contract, a missed deadline, or inaccurate advice, a single oversight shouldn’t jeopardize everything you’ve built.
Even when you’ve done nothing wrong, a client can still sue. And if a customer accuses you of negligence or failing to deliver on a project, E&O can help cover your legal defense costs, settlements, and judgments
In this guide, we’ll break down what Errors & Omissions insurance typically costs, what drives the price, and how to get a quote through Simply Business.
What Factors Affect Your Errors & Omissions (E&O) Insurance Cost?
There’s no one-size-fits-all price tag for E&O insurance. But here are the primary factors that may drive your premium up or down:
Your Profession and Industry
The exact kind of work you do is the biggest driver of your E&O insurance cost. When setting your rate, insurance providers look at the potential financial damage a single mistake could cause. The higher the financial stakes of your advice or services, the higher the risk baseline — and the premium.
For example, if an IT consultant overlooks a bug in a line of code, causing a client’s new e-commerce site launch to be delayed by two weeks, that could cost thousands in lost holiday sales. Similarly, a real estate agent’s administrative oversight could cause a critical closing deadline to be missed, resulting in the cancellation of a legally binding property sale. Because the financial fallout in these fields can be severe, their premiums sit at the top of the scale.
Median Monthly Errors & Omissions Premiums by Profession
| Profession | Median Monthly Cost1 |
|---|---|
| Beautician/cosmetology services | $41 |
| Bookkeeping | $27 |
| Business consulting | $53 |
| Life/career/executive coaching | $28 |
| Notary services | $28 |
| Other consulting services | $41 |
| Real estate agent | $41 |
| Teaching or tutoring | $41 |
1Data from Simply Business customers who purchased an E&O policy from July 1, 2025 to December 31, 2025. The median costs shown are for illustrative purposes only; actual premiums vary by state, coverage limits, and individual business risk.
Your Location
Where you register and operate your business matters. Geographic location impacts your E&O insurance cost because state laws, local regulations, and court systems vary wildly across the country.
Some states have a higher volume of professional liability lawsuits, strict consumer protection laws, or dense commercial hubs. If you operate in one of these types of states, insurance companies face a higher risk of costly legal battles, which can elevate your baseline premium.
Conversely, states with less strict laws or lower averages for court settlements, typically see lower standard premiums.
Median Monthly Errors & Omissions Premiums by State
| State | Median Monthly Cost2 |
|---|---|
| California | $33 |
| Florida | $42 |
| Georgia | $38 |
| Illinois | $42 |
| New Jersey | $46 |
| New York | $42 |
| North Carolina | $33 |
| Pennsylvania | $33 |
| Texas | $38 |
| Virginia | $38 |
| Washington | $33 |
2Data from Simply Business customers across some of our most common states, who purchased an E&O policy from July 1, 2025 to December 31, 2025. The median costs shown are for illustrative purposes only; actual premiums vary by state, coverage limits, and individual business risk.
Business Size and Gross Revenue
The size and financial scale of your business directly impact your rate. Insurance providers look at your gross revenue and your total employee count to gauge your overall exposure to mistakes — the larger your business grows, the more opportunities there are for an error to happen.
A firm managing multiple large-scale client contracts with a team of 15 employees has a lot of moving parts. With more people handling projects and higher revenue on the line, the risk of oversight increases and your E&O insurance cost may too.
If you’re a solo independent contractor with a smaller client list and lower annual revenue, your overall exposure is much lower, which can help keep your premiums affordable.
Coverage Limits and Deductibles
Adjusting your policy’s coverage limits and deductible acts like a pair of dials, each moving your premium up and down.
This is the maximum amount your insurance will pay out for a claim. Choosing a higher limit means the insurance company takes on more financial responsibility, which increases your monthly premium.
This is the out-of-pocket amount you agree to pay before your insurance coverage kicks in. If you choose a higher deductible, you take on more of the initial cost for smaller claims. Because this reduces the financial risk for the insurance company, they typically will pass those savings on to you with a lower monthly E&O insurance cost.
Claims History and Experience
Your professional track record serves as real-world proof of your risk level. Maintaining a clean, claim-free history and demonstrating years of continuous operation tells insurance providers that your business practices are highly reliable. Small businesses with years of claim-free coverage are viewed as lower risk and often receive the most competitive rates.
If your business has experienced Errors & Omissions claims within the past three to five years, insurance companies may apply a premium surcharge to offset that risk. Showing long-term stability and consistent quality control is one of the best ways to keep your E&O insurance cost low over time.
How to Save on Errors & Omissions (E&O) Insurance
Fewer claims typically lead to lower rates. That’s why risk management should be a top priority. Here are just some of the ways you can manage risk for your business:
- Train your team: Conduct regular training to reduce mistakes and avoid potential lawsuits.
- Standardize your contracts: Use clear, signed client agreements to set expectations.
- Document communications: Keep a paper trail of all client approvals and decisions.
- Use QA checklists: Catch minor errors early with peer reviews and quality checks.
Voluntarily raising your policy deductible is one of the fastest ways to lower your premium. Just ensure your business retains enough cash on hand to comfortably cover that higher out-of-pocket amount if a client files a claim.
Some insurance carriers offer a discount if you pay your annual premium in one lump sum. Choosing this option eliminates the administrative fees that often come with breaking your premium down into monthly installments.
Avoid lapses in your insurance protection. Maintaining continuous, uninterrupted policy terms allows you to build a favorable history over time, which may help you qualify for preferred tier pricing discounts.
You don’t have to spend hours searching for the right policy. Simply Business pulls customized coverage options from top-rated small business insurers in just 10 minutes. We do all the legwork so you can easily compare quotes and save.
What Some Customers are Paying for E&O3
Maryland
Tax Preparation
$33/month
- Sole Proprietorship
- Limit: $500,000
- Deductible: $1,000
- Quoted May 2026
Virginia
Real Estate Agent
$96/month
- Sole Proprietorship
- Limit: $1Million
- Deductible: $1,000
- Quoted May 2026
Maryland
Bookkeeper
$25/month
- Sole Proprietorship
- Limit: $100,000
- Deductible: $0
- Quoted May 2026
3These examples are real insurance quotes generated on the dates above. They are for illustration purposes only. Your coverage options and pricing may differ based on the information you provide us about your particular business, the state you operate in, the number of employees, and other factors.
Frequently Asked Questions (FAQs)
Answers to More Questions About E&O Insurance
Errors & omissions (E&O) insurance, also called professional liability insurance, typically covers legal defense costs and potential settlement payouts if a client sues your business for certain professional mistakes, including:
Negligence or alleged negligence: Claims of mistakes, poor service, missed deadlines, or a lack of proper care.
Poor results: If your business doesn’t deliver work as promised, or if your client receives unexpected poor results due to alleged professional negligence or error, a client could sue you to recover any losses they experienced.
Employee mistakes: Claims related to mistakes or oversight by your team.
E&O generally won’t cover:
Intentional mistakes and omissions
Client injuries or property damage (typically falling under general liability)
Employee injuries (typically handled by workers’ comp)
The term errors & omissions (E&O) insurance is often used interchangeably with professional liability insurance, and for the most part, they’re identical. Depending on your profession or line of work, one term may be used more commonly than another, but both intend to help protect businesses against claims of negligence or professional mistakes.
Many service businesses choose to carry both. General liability insurance typically covers physical risks, such as third-party bodily injury or property damage. Errors and omissions insurance helps cover professional risks, specifically the financial losses a client might suffer due to a mistake, omission, or failure to deliver your professional services. Because their coverages do not overlap, having both creates a more comprehensive safety net.
Yes, for most policies. COIs for most policies are available as soon as you purchase your coverage. With Simply Business, you can download and share your COI instantly through your online account or right from your phone. If a client needs proof of E&O coverage before signing a contract, you can pull your COI and send it over in minutes.
Errors & omissions (E&O) insurance isn’t just for consultants and advisors. Any business paid to deliver a professional service can be sued if a client believes the work fell short. Think of a photographer who misses key wedding shots, a designer whose work causes a client to miss a launch, or a software developer accused of a coding oversight, all of which could be grounds for potential lawsuits by customers. If clients rely on your skill or expertise to get a result, professional liability coverage is worth considering.
Real-world examples vary by trade, but an E&O claim is typically triggered when a client alleges that a mistake caused the client a financial loss. For example, an IT consultant might accidentally delete a vital database during a migration, halting a client’s daily operations. An insurance agent might neglect to submit a policy amendment, leaving a client unprotected during a major loss. Or a realtor might negligently fail to disclose a property defect, leading to a non-disclosure lawsuit from the home buyer.
Maybe. Premiums for your errors & omissions (E&O) policy are generally considered a tax-deductible business expense. Keep records of your payments throughout the year so they’re easy to claim at tax time, and check with your accountant or tax professional to confirm what applies to your specific business.
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*The displayed price for each product is a monthly estimate calculated from the 10th percentile of relevant policies sold by Simply Business (e.g., General Liability data is used for General Liability estimates). This estimate uses data from relevant policy sales between July–December 2025. Final price and payment terms, which may include an initial down payment, are subject to change based on your state, selected insurance provider, and specific business details.
‡ Displayed price is based on the lowest available coverage limit for Equipment and Small Tools policies.
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