Various financial advisors bear a great deal of responsibility for the decisions their clients make. Even if they believe they have no responsibility, in the event of a significant loss from an investment or from a wrong economic or business decision, the advisor who led to the decision bears some responsibility. The consultant is exposed to lawsuits, and the amount of his responsibility can amount to hundreds and millions of dollars.
What is Errors and Omissions Insurance (E&O) for Financial Advisors?
E&O insurance protects financial advisors (such as mortgage advisors, financial planners, trading managers, money agents, and financial experts) for claims filed against them, alleging various professional mistakes they made.
E&O insurance for financial advisors covers the internal cost that relates to claims, such as the legal cost related to the representation of the financial advisor and the cost of compensation to the defendant. Professional liability insurance for financial advisors allows advisors to work in a professional environment without fear of making decisions for the client.