When entrusted with economic responsibility, financial services professionals are held responsible for any errors or mistakes made in the course of performing their job. Fear of making a mistake could keep a professional from taking rewarding risks that could have positive results for clients. For this reason, businesses should carry fiduciary liability insurance. Many professionals believe that a general liability insurance policy will cover them for errors and omissions. This is not necessarily the case. Fiduciary liability insurance helps to cover the gaps that a general policy may not cover.
Avoiding Mistakes May Not Earn You a Break
Even if no genuine error has been made, a simple claim of wrongdoing can deplete an organization’s financial resources. You must still defend yourself from allegations, even those with no supportable foundation. Fiduciary liability insurance can assist with legal expenses and asset protection.
Explore Your Exposure
Assertions of wrongdoing can take many forms. Depending on the specifics of your business, there may be exposure from inaccurate or misinterpreted advice, clerical mistakes, and non-judicious management or investment of assets. When working with an agent to determine the best policy for you, the types of potential accusations you may be exposed to will be considered. Contact your local insurance agent to perform a comprehensive risk analysis to determine your areas of vulnerability.