Q: If you are doing business only as an LLC, does it make sense to have E&O for yourself as an individual?
I do contract computer programming and (since 2018) do this as a single member LLC. I am careful to do business only as the LLC.
When I renewed my E&O insurance last year I switched to the name of the LLC. Late in the process I asked if this would also cover me personally, in the event that I was sued personally or the LLC veil was pierced. I got an assurance that as long as I was doing business in the name of the LLC I would be fine, but I am not sure the person I talked to really understood the question and I don't trust this assurance.
I would like to have E&O that covers both the LLC and me personally, but I don't want to pay twice and I'm not sure I can get this from my current insurance provider on a single policy. Maybe I can if I know how to ask for it.
Does it make sense to have E&O that covers me, personally, if I am not doing business in my own name? Is that safer for me if I do get sued (I have more money in personal savings than I do in the LLC)?
A: Your question is about the extent of coverage of an E&O insurance policy. The extent of the coverage would be affected by the specific terms of the insurance policy. Rather than rely upon a blanket statement, you may want to have an attorney review your specific policy to answer the question. As part of your process, you may also want to do some comparison shopping. A competitor may point out inadequacies of your existing policy or point you to greater coverage that may not be available from your existing insurance agent. In any event, an oral assurance should not be relied upon in absence of specific written language to which it makes reference.
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