I'm expanding my utility auditing business here in Indianapolis and my current E&O policy is only $250K. My attorney says I should bump it up to at least $1M given some of the larger commercial accounts I'm taking on. What coverage limits do you all carry? Any recommendations on carriers that understand our business?
E&O Insurance - How much coverage do you carry?
I carry $2M through Professional Liability Specialists. They've been great to work with and actually understand what we do. Had a claim two years ago when a client disputed my findings on their Duke Energy account - saved me about $35K in legal fees alone. The premium isn't cheap but it's worth every penny.
Terry's right about PLS - they're solid. I've got $1.5M coverage with them. Key thing is making sure your policy covers both professional errors AND data breach issues. More utilities are requiring cyber liability coverage now, especially if you're handling their customer data for large audits.
Don't forget to check if your carrier has experience with utility consulting claims. I had a nightmare with my previous insurer who didn't understand rate schedule errors. They wanted to settle a bogus claim for $15K rather than fight it. Switched to Beazley and they actually know our industry.
Greg - definitely go with $1M minimum. I learned this the hard way when a client claimed I missed $180K in overcharges on their CPS Energy account. Even though I was right, the legal defense costs alone hit $45K. My $500K policy covered it but barely left room for anything else.
Another vote for higher limits. I carry $3M because I do a lot of industrial accounts with FirstEnergy. One mistake on a steel plant's demand charges could easily cost six figures. The extra premium for higher limits isn't that much more once you get past $1M.
Thanks everyone - sounds like $1M is the minimum and $2M+ makes sense for larger accounts. I'll get quotes from PLS and Beazley. Frank, good point about the marginal cost for higher limits. Better safe than sorry in this business.
One more tip - make sure your policy has a good reputation coverage clause. Sometimes the threat of a claim can hurt your business even if it's groundless. My policy covers PR costs to protect my reputation, which has been valuable.