At any time and in any given situation, a dissatisfied individual can choose to bring a complaint against you. When people sue, they usually name everyone they perceive as having had anything to do with the situation—you and your business. Routinely, claimants sue as many individuals as possible.

Regardless of who is or whether anyone is negligent, it can take years for litigation to be dismissed. While you may be exonerated from liability, your attorney fees can be staggering. E&O insurance can help minimize the financial burden you may face should you have to defend yourself in a lawsuit.

If you’re providing travel services, this coverage is recommended. In fact, many companies, vendors or customers may require you to have E&O insurance before doing business with them.

Of the suits that could be brought against you, the most common is for negligence in the performance of services. Negligence suits arise from damages sustained due to failure to perform according to known standards of conduct in a specific field. The financial consequences of such suits, including the costs to defend them, can be severe. As a result, it is critical that service providers recognize their exposures to financial losses and adopt effective means to deal with them.

Even if we were to assume that you or your business would never be negligent, you simply cannot ignore the fact that anyone can allege virtually anything—and drag you into court. The issue may not even have anything to do with you. If you were even remotely involved in the disputed work, you are likely to face a legal suit. Even if it turns out that you have done nothing wrong, you could still be faced with thousands of dollars in defense costs.

Additionally, it’s important to note that having E&O insurance does not make you more likely to be sued. It simply makes you more prepared if a lawsuit is brought against you.