Information and requirements related to Errors & Omissions (E&O) insurance with specifications to Proof. Professional Liability Policies and differences between aggregate and per occurrence information are also in this article.
🎯Primary Audience: Notaries
Need to Know
Errors & Omissions (E&O) insurance protects you from liability for false claims or unintentional notarial mistakes or omissions. You must provide information about your policy, and you must upload a copy of your E&O insurance policy to the platform for at least:
- Real Estate: $100,000
- Retail & Business: $25,000
Professional Liability Policies
Your business may rely on an umbrella policy if it covers each individual notary for the required amount (at least $100,000 for Real Estate or $25,000 for Retail or Business).
🚨 If you are an independent contractor taking calls via the On-Demand Notary (ODN), Notarize, Inc. (dba Proof.com) must be listed as a certificate holder if you use a professional liability insurance policy. This requirement only applies to notaries in Florida, Nevada, Texas, and Virginia who are enabled to take calls from the ODN queue:
This does not apply to notaries employed by an organization that is a customer of Proof, known as In-House Notary (IHN).
This does not apply to notaries who only initiate their own transactions and do not take calls from the ODN queue.
This does not apply to personal E&O policies.
Learn more about the "why" behind the requirement above
A standard E&O policy is issued to an individual notary and is prepurchased for a set time. A professional liability insurance policy is issued to a business and stays in place only if the business continues to pay the monthly premium.
We allow businesses to use a professional liability insurance policy only if they name Notarize, Inc. (dba Proof.com) as a certificate holder so that we are notified if the business stops paying the insurance premium (which would cause the policy to lapse). A personal E&O policy is prepaid. Therefore, it is less likely that the policy will prematurely lapse.
How Does E&O Work?
E&O Insurance is liability coverage designed to protect both a notary and the person who hired the notary.
A notary can be sued if they make an unintentional error. In large financial deals (like a real estate closing), that is a huge potential loss.
Aggregate vs. Per Occurrence
- Aggregate Amount = The total amount of coverage under the policy
- Amount Per Occurrence = The amount of E&O coverage per “claim” (occurrence = claim)
A lender asks for $100,000 per occurrence. For each E&O claim, the lender would like to be able to use all $100,000 of that insurance (each occurrence = 1 claim):
- If the policy is $100,000 in aggregate (total), with the ability to pay out $100,000 per occurrence (per claim), then 1 single claim could wipe out the E&O coverage.
Typically, E&O insurance is $10,000 per occurrence, covering 10 claims at $10,000 each if your total policy is $100,000. Having the policy structured "per occurrence" potentially provides coverage that could be shared among multiple lenders and title agents.
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