What is the difference between Vicarious Liability and Corporate Coverage?
Subject to certain conditions, entities are considered to have a separate legal status and therefore can be sued. The company’s liability stems from the actions of its employees. As such, an entity may purchase insurance coverage to protect itself from that liability. We refer to this entity coverage as “Corporate E&O” coverage. Here are some examples of what the member’s policy will not cover on behalf of a Corporation: • A suit against the corporation for an act, error, or omission the member committed that is not covered under the member’s personal policy (e.g. non-covered service); • A suit against the corporation for an act, error, or omission committed by a non insured employee (unless considered an unlicensed practitioner to the individually covered member); • A suit against the corporation for activities outside the accounting services. Corporate coverage is pure entity coverage, insuring the corporation for its liabilities. Vicarious Liability covers the corporation ONLY with
