A client asked his agent in writing to add a disability income rider to an existing policy, but the agent forgot to process the request. The client later becomes disabled, the claim is denied, and the client sues the agent. How will the agent's errors and omissions (E&O) policy most likely respond?

Why B is correct

Forgetting to order coverage the client requested is a classic negligent omission in the performance of professional duties, which is precisely the exposure E&O insurance is designed to cover. The policy typically provides defense and indemnity for claims alleging negligent errors, omissions, or mistakes such as failing to forward an application, overlooking a requested rider, or giving incorrect advice. Only intentional, fraudulent, or criminal conduct falls outside coverage.

Why the other options are wrong

• A) Failure-to-place claims are among the most common E&O claims; the policy exists precisely to respond to negligence in obtaining requested coverage, not to exclude it.
• C) Agents can be held personally liable to clients for professional negligence; E&O does not remove that liability, it funds the defense and pays covered judgments or settlements.
• D) This reverses the coverage rule: intentional wrongdoing is excluded from E&O coverage, while negligent mistakes are exactly what the policy covers.

Memory hook

E&O covers what you did by accident, not what you did on purpose. Intent kills coverage.