Hello everyone!

I'm wondering what type of insurance do I need for my VA business. I've heard that you should have liability insurance. Ok, this may sound dumb but liability for what? It's not like I'm going to have anyone slip and fall coming into my home office. I know, that's a smart alack comment but seriously, what kind of insurance do we need to do this business?

Thanks, Barbara.

Actually you should get E&O (Error and Omissions) to protect you from costly mistakes you could make. Basically should you make an error or omit information that costs your client losses, the insurance coverage will kick in. It may not seem necessary but I personally will not take the chance.

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Lee Drozak
My Office Assistant

I would be very interested to see what others have to say about this issue.

I would have thought that, at the end of the day, it is the client's responsibility to check that the work completed is correct and that if you have something in your contract to that effect, you would be covered. But I may be completely deluded there....

Liability insurance is incredibly expensive (here in Australia at least). I had cover when I ran my resume writing business which cost me something like $1,400 for a year. In hindsight, I'm kicking myself that I wasted that kind of money for nothing

Keri

Yes Lee, I have heard of Errors & Omissions insurance and I could see the necessity for it if I were offering bookkeeping or other financial services but I'll primarily be doing writing/editing. As Keri says, proofing is the responsibility of the client and it will say so in my contracts. Isn't that enough?

Thanks, Barbara

I also believe that the size of my business does not yet warrant the overwhelming expense of E&O insurance. In New York State our insurance is incredibly expensive. I do bookkeeping work, but I also have my clients sign a contract which contains a hold harmless clause in it, and I may be wrong, but I feel that protects me somewhat. It states I take "their" information, and enter it in "their" program which "they" set up under the advice of someone else. The bookkeeping that I do is basic data entry and bank reconciliations and the information gets turned over to a tax accountant. At some point perhaps E&O coverage is appropriate for me, but not in my current status.

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Debbie Bilello, Owner
Virtual Office Solutions

Here is a great definition of E&O

Quote:

Errors and Omissions Insurance protects your company from claims if your client holds you responsible for errors, or the failure of your work to perform as promised in your contract. Coverage includes legal defense costs - no matter how baseless the allegations. Errors and Omissions Insurance will pay for any resulting judgments against you, including court costs, up to the coverage limits on your policy.

As you can see it protects you even if the claim is baseless. I carried it at first because of bookkeeping services but now I keep to just to protect myself.

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Lee Drozak
My Office Assistant

I am just in the very beginning phase of starting up as a VA (in real estate) I have called a couple of companies about E & O insurance, they don't offer if for real estate VA's. They did for book keeping and technology. Anyone real estate VA have E & O insurance and if so, can you direct me to the agency?

Hello every one!
I spoke with a lawyer and my broker about this. I would venture to say that most of us are running our businesses from our homes.

As such, we would have homeowners' insurance. When you run a business from your home, you should ask your broker to quote you on a business "rider". That will protect you should anything happen like: your home got broken into and they stole your computer equipment, or a fire where the room where your office is got damaged. Without this insurance rider your insurance company can refuse to compensate you for any of these losses. They might even deny your claim entirely saying you did not inform them that you were using your home for a business purpose. (We all know how much insurance companies love to pay out, don't we?)

My broker quoted me a rider on my existing policy for general liability, loss of equipment and minimal errors and omissions that will only cost an additional $250 a year to my homeowners' policy. I think 21 bucks a month is worth it for my peace of mind.

The other thing that I didn't initially consider is putting a rider on my car for the business. Yes, I work virtually but I do know that I may use my car to see local clients and for drumming up business (attending networking meetings for example). If, heaven forbid, I get into an accident on the way to a Chambers meeting, or if I have client files in my car that got destroyed in an accident, my insurance won't cover me.

I don't know about you but I'd rather be safe than sorry.
Barbara

Just got a quote for E&O insurance, $1442 for the year, Limits of insurance liability and claims is $500,000 with a deductable of $2500. Or $1730 with 1,000,000 liability and claims with the $2500 deductable. Has anyone found anything better or what I really mean, has anyone found anything cheaper?
Marybeth

Hi:

I carry e&o as a real estate agent/broker and it is indeed expensive. I think for the time being I will not use e&o insurance as I hate bookkeeping and will not do it. Having a hold harmless clause in your contract at least is a good start.

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Penelope Myer
Penelope and Partners