What is the difference between E&O and GL?
Quick Answer: E&O vs GL
The main difference between E&O and GL is what they cover:
E&O (Errors & Omissions) insurance covers financial losses caused by professional mistakes or failure to deliver promised services.
GL (General Liability) insurance covers bodily injury, property damage, and related legal costs.
👉 Think of E&O as protection for what you do, and GL as protection for what can happen around you.
| Coverage Type | E&O Insurance | General Liability Insurance |
|---|---|---|
| Covers | Financial losses from errors or omissions | Bodily injury & property damage |
| Applies to | Professional services, advice | Physical operations & premises |
| Typical claim | Client loses money due to mistake | Customer slips and falls |
| Legal defense | Included | Included |
| Requirement | Often required by contracts | Often required by law |
What Is E&O Insurance?
Errors and Omissions (E&O) — also called Professional Liability Insurance — protects businesses and professionals if a client claims they lost money because of your error, negligence, or failure to deliver a promised service.
What E&O Covers:
Professional mistakes or errors
Missed deadlines
Breach of contract
Negligence or misrepresentation
Failure to meet professional standards
Legal defense and settlements
Example:
A marketing agency misses a campaign deadline, causing a client to lose $50,000 in sales. E&O insurance covers the lawsuit, legal defense, and settlement.
What Is General Liability Insurance?
General Liability (GL) insurance covers accidents and injuries that happen to third parties because of your business activities — but not professional errors.
What GL Covers:
Bodily injury to third parties
Property damage caused by your business
Medical expenses
Personal and advertising injury
Legal defense and settlements
Example:
A customer slips on a wet floor at your office and breaks their arm. GL insurance covers medical costs, legal fees, and any settlement.
Key Differences Between E&O and GL Insurance
| Feature | E&O Insurance | General Liability Insurance |
|---|---|---|
| Type of claim | Financial loss from professional service | Physical injury or property damage |
| Trigger | Error, negligence, or failure to perform a service | Accident occurring on premises or during operations |
| Who needs it | Professionals (consultants, accountants, tech, legal, etc.) | Any business with physical operations or client contact |
| Required by | Clients, contracts, professions | Landlords, vendors, state regulations |
| Legal defense | Included | Included |
| Coverage limit | $250K–$5M+ | $1M–$2M typically |
| Exclusions | Bodily injury, property damage | Professional errors, contractual disputes |
✅ E&O = protects your professional services
✅ GL = protects your physical business operations
Why Many Businesses Need Both E&O and GL
Most businesses face both professional risks and physical risks.
If you give advice or services → You need E&O
If clients visit your office or you operate in public → You need GL
Example Scenario:
A consulting firm gives wrong advice to a client → E&O covers it.
A client slips in their lobby → GL covers it.
👉 Without both, one uncovered lawsuit could cost hundreds of thousands of dollars.
E&O vs GL: Real-Life Examples
| Situation | Type of Insurance | Covered? |
|---|---|---|
| Consultant gives bad advice causing $200,000 loss | E&O | ✅ |
| Customer trips in your office and breaks their ankle | GL | ✅ |
| Employee damages a client’s property during a site visit | GL | ✅ |
| Software developer’s error crashes a client’s system causing revenue loss | E&O | ✅ |
| Business owner accused of slander in advertising | GL | ✅ |
| Project delay causes contract penalties | E&O | ✅ |
How Much E&O and GL Coverage Do You Need?
Coverage amounts depend on your industry, business size, and contract requirements.
| Business Type | Recommended E&O Coverage | Recommended GL Coverage |
|---|---|---|
| Freelancers & consultants | $250,000 – $500,000 | $1,000,000 |
| Small businesses | $500,000 – $1,000,000 | $1,000,000 – $2,000,000 |
| Medium-sized companies | $1M – $2M | $2M |
| High-risk professions (legal, medical) | $2M – $5M+ | $2M+ |
Tip: Some insurers offer combined packages with both E&O and GL at a lower price than buying separately.
Cost of E&O vs GL Insurance
| Insurance Type | Average Annual Premium | Key Cost Factors |
|---|---|---|
| E&O Insurance | $500 – $3,000+ | Profession, revenue, claim history, coverage limit |
| GL Insurance | $400 – $2,000+ | Industry, location, size, number of employees |
👉 Working with an independent agency like Toby Hansen Agency can help you compare nearly 100 carriers to get the best deal.
Who Should Get E&O Insurance
Consultants & freelancers
IT & software developers
Accountants & financial advisors
Marketing agencies
Real estate professionals
Legal service providers
Healthcare providers (malpractice is a form of E&O)
Who Should Get GL Insurance
Any business with a physical location
Contractors and service companies
Retail and hospitality businesses
Freelancers working on-site with clients
Event organizers and vendors
Common Misconceptions About E&O and GL
🚫 “I don’t need E&O because I’m careful.”
Even the best professionals make mistakes — and clients can sue even if you’re not at fault. Legal defense alone can cost tens of thousands of dollars.
🚫 “I only need one of the two.”
Most businesses face both professional and physical risks. One policy won’t cover everything.
🚫 “I can get covered later if something happens.”
Insurance doesn’t work retroactively. If you don’t have coverage when the incident occurs, you’re on your own.
How to Get E&O and GL Coverage
Assess your business risk.
Determine the right coverage limits for your industry.
Compare quotes from multiple carriers (not just one).
Bundle E&O and GL to save money.
Review exclusions carefully.
Start coverage immediately to avoid gaps.
👉 Toby Hansen Agency helps businesses compare nearly 100 carriers to find the lowest price with the most coverage.
Why Choose Toby Hansen Agency
✅ Over 30 years of experience
✅ Access to nearly 100 insurance carriers
✅ Customized coverage tailored to your business
✅ Competitive pricing and expert support
✅ Fast quotes and easy application
Whether you need E&O, GL, or both, our team helps you protect your business — and your future.
Final Thoughts
What is the difference between E&O and GL?
E&O protects your professional work — your service, advice, and expertise.
GL protects your physical operations — what can happen around your business.
👉 To make sure your business is fully protected, fill out the quote form below.
With over 30 years of experience, Toby Hansen Agency will find you the best coverage at the best price.
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