E&O insurance policies tend to be much more expensive for property & casualty agents than for life/health agents. The general rule when you write both property & casualty and life/health insurance is that whichever side generates more than 50% of your commissions determines whether you fall under a property & casualty policy or a life/health policy. Therefore, in general, if more than 50% of your commission income is derived from the sale of property & casualty insurance, you must purchase an E&O policy for property & casualty agents which will also cover you for your life and health products.
Property & casualty agents and brokers mostly sell insurance covering cars, homes, and businesses. Some of the most common personal and commercial lines of business include homeowners, farmowners, automobile, dwelling property, general liability, business property, inland marine, watercraft, workers' compensation, errors and omissions, medical malpractice, directors and officers, employment practices liability, umbrella, aircraft, marine, surety, and crop.
Insurance products such as flood, surety, professional liability and management liability are considered to be riskier than other P&C products and therefore the cost of E&O insurance for agents who specialize in these products tends to be higher.
Property and casualty insurance products and risks tend to be more complex than life and health products and risks. Therefore, property and casualty agents are more likely to make and actual, or alleged, error or omission while providing their services. This higher risk is the reason why the premiums paid by P&C agents for E&O insurance are higher than those paid by life, A/H agents.
E&O insurance policies for property & casualty agents are usually issued on a claims made form. The E&O policy generally covers claims made against property & casualty insurance agents and brokers by reason of an error or omission in the performance of professional services. The policy provides no coverage for claims resulting from an act, error, or omission which took place before the retroactive date.