What does Electronic Products Errors and Omissions Insurance mean? Read on to discover the definition & meaning of the term Electronic Products Errors and Omissions Insurance - to help you better understand the language used in insurance policies.
Electronic Products Errors and Omissions Insurance
A policy form designed to cover claims in which the malfunctioning or nonfunctioning of electronic products causes financial loss rather than bodily injury (BI) or property damage (PD). For example, assume an accounting software program contains a "bug" that causes a company using the software to understate its receivables by $500,000 during a fiscal year. An electronic products errors and omissions (E&O) policy would cover the software manufacturer's liability for losses sustained by the customer under these circumstances. Such policies are needed because commercial general liability (CGL) insurance is limited to covering BI and PD liability, rather than liability for financial loss.
We hope the you have a better understanding of the meaning of Electronic Products Errors and Omissions Insurance.