General Liability Insurance vs. Errors and Omissions: What’s the Difference and Which Do You Need?

Running a business comes with risk—whether you’re a retail shop owner, a freelance consultant, or a full-service marketing agency. Two key types of insurance can help protect you when things don’t go according to plan: general liability insurance and errors and omissions (E&O) insurance.

Though they both offer important coverage, they protect against very different risks. Let’s break down what each type covers, how they differ, and when you might need one—or both.

What is General Liability Insurance?

General liability insurance (also called commercial general liability or CGL) is the most basic form of business insurance. It protects your business from third-party claims involving:

• Bodily injury (e.g., a customer slips and falls in your store)

• Property damage (e.g., your employee accidentally damages a client’s laptop)

• Advertising injury (e.g., you’re sued for slander, libel, or copyright infringement)

Essentially, general liability insurance covers accidents and damages that happen as a result of your physical business operations. It's foundational coverage—often required for leases, contracts, or licensing.

What is Errors and Omissions (E&O) Insurance?

Errors and omissions insurance—sometimes called professional liability insurance—covers financial losses your clients experience because of your professional services. This includes:

• Mistakes or oversights in your work

• Failure to deliver a service as promised

• Negligence in providing professional advice

E&O is especially important for service-based professionals—think consultants, designers, IT professionals, lawyers, and accountants. Even if you didn’t actually make a mistake, E&O helps cover legal defense and settlements if a client claims you did.

Key Differences at a Glance

Feature	General Liability Insurance	Errors & Omissions (E&O) Insurance
Protects Against	Physical injuries & property damage	Professional mistakes & service errors
Covers	Third-party bodily injury, property damage, slander	Financial losses from bad advice or negligence
Best For	Businesses with a physical location or product	Service providers, consultants, professionals
Required For	Commercial leases, vendor contracts	Professional licensing, client contracts

Do You Need Both?

In many cases, yes.

For example:

• A marketing agency may need general liability to protect against claims if a client visits their office and gets injured, and E&O to cover mistakes in ad copy or campaign strategy.

• A contractor might need general liability for on-site risks and E&O to cover disputes about project specs or timelines.

If your business interacts with the public and provides professional advice or services, having both policies is often the safest choice.

Final Thoughts

General liability and errors and omissions insurance are both critical for shielding your business from unexpected claims—but they cover very different types of risk. Think of general liability as protection from accidents, and E&O as protection from professional missteps.

Still unsure which is right for your business? At Insurance Connection, our licensed agents are here to help you navigate the options and build a policy tailored to your needs – so you’re protected no matter what life throws your way.