I am forming an LLC as a professional guardian. What type of liability insurance do I need?
Whether it is a guardian or a trust there are two types of coverage to consider: Fidelity Bonds and Errors and Omissions Insurance commonly referred to as E&O Insurance.
A bond is a promise to pay, for example, if the trustee stole from the trust, then the bond would pay. The credit and assets of the trustee is important in determining if a bond will be issued, as the bond is usually the payment of last resort.
E&O Insurance is used, as its name implies, to cover mistake. For example, if a guardian made a poor investment decision or failed to transact necessary paperwork, E&O insurance could provide a defense and cover the loss.