Notaries errors and omissions (E&O) insurance

Errors and omissions (E&O) insurance, sometimes called professional liability insurance, protects service-based professionals from legal costs related to accusations of negligence, errors, or failure to deliver services as promised. If a client claims your notarial services caused them financial harm, an E&O insurance policy can help cover your court costs, settlements, and judgments – so you don’t have to pay out of pocket.

This policy provides liability coverage related to:

• Errors, such as missing a signature requirement
• Failure to notarize a document on time
• Accusations of professional negligence

Errors and omissions insurance provides financial protection when a notary is accused of negligence or making a professional mistake, such as failing to properly witness or notarize a document, misidentifying a signer, or stamping or certifying incorrect documents.

Imagine a notary is hired to witness and notarize a real estate document. In the process, they overlook a required signature on one of the pages. The oversight isn’t discovered until after the document has been submitted to the title company, causing a delay in closing the property deal. The buyer backs out, and the seller sues the notary for damages, claiming the error cost them the sale. A notary E&O policy would cover the notary’s legal defense and any resulting settlement or judgment.

A mobile notary is scheduled to notarize loan documents for a client refinancing their home. Due to a scheduling mistake, the notary arrives hours after the deadline, causing the loan to fall through. The client sues the notary, claiming they lost a favorable interest rate and incurred financial harm as a result of the delay. E&O insurance would help pay for legal expenses and any compensation awarded to the client.

A notary is accused of notarizing a document without properly verifying the signer’s identity. Later, it’s discovered the person who signed the document wasn't authorized to do so, resulting in a legal dispute over a power of attorney (POA). Even though the notary followed standard procedures, they're named in the lawsuit. E&O insurance would provide coverage for the cost of defending against the negligence claim – even if the notary is ultimately found not at fault.

The most common E&O policy for notaries includes:

• $1 million per-occurrence limit
• $1 million aggregate limit
• $500 deductible

This level of coverage is often sufficient for most notaries, although your needs may vary depending on your business size, the volume of notarizations you perform, or any employer requirements.

In most states, notary errors and omissions insurance is recommended but not legally required. That said, you may still need to carry E&O insurance if you:

• Work for a government agency or private company that requires it
• Want to protect yourself beyond the basic coverage offered by a notary bond
• Operate in a state or jurisdiction with strict notary laws or high litigation risk

In some cases, your employer may require you to carry a policy that exceeds your notary bond amount. While state laws vary, it's a smart move to check your local requirements – and consider carrying E&O insurance regardless of whether it's mandated.

Some examples include:

Notary E&O insurance offers peace of mind and protection that goes beyond what a surety bond provides. Key benefits include:

• Financial protection from costly lawsuits
• Coverage for legal defense, court fees, and settlements
• Greater trust from clients and employers
• Affordable premiums with robust coverage

Even a single claim could result in thousands of dollars in legal fees, damages, and other financial losses. E&O insurance may end up saving you far more than the cost of the policy itself.

A notary bond is a type of surety bond that protects the public, not the notary. If a notary makes an error or commits fraud, the bond reimburses the affected party. However, the notary is required to repay the bonding company for any claims paid out.

In contrast, notary E&O insurance protects the notary directly. If you're sued over a mistake, this insurance helps cover your legal costs and damages without requiring repayment.

We recommend purchasing both a notary bond and E&O coverage to ensure your business is fully protected.

Are you ready to safeguard your notary business with commercial insurance or a business bond? Insureon helps notaries public find affordable insurance coverage from top-rated insurance companies with one easy online application today.

If you need help deciding on the best policy or coverage type, our licensed insurance agents can offer guidance that best suits your business's needs. Once you find the right policy, you can begin coverage and get a certificate of insurance in less than 24 hours.