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How Much E&O Insurance Do I Need as a Notary?

Notaries are essential when signing complicated legal documents or official paperwork. By having a notary present, people ensure the legality and integrity of their official paperwork. Notaries protect anyone transferring assets, making business deals, creating a will, buying real estate, or doing many other things. With a notary, signers find themselves better protected from fraud.

Even though notaries are meant to protect signees, there are some instances where a notary can make a mistake. Though this doesn’t happen often, notaries can protect themselves from legal fees and action by getting an Errors and Omissions (E&O) insurance policy either when they become a notary or renew their certification.

Find out how much E&O insurance you will need as a notary. We’ll walk you through why an E&O policy is worthwhile—and how it will help you as a notary.

What Is E&O Insurance for Notaries?

E&O insurance stands for Errors and Omissions. If a notary has any legal claims or lawsuits brought against them, they can use this insurance to pay for the legal proceedings.

Some states require notaries to have this insurance, but many don’t. It’s often left to the notary to decide if they want to pay for this type of insurance coverage.

How Much Does E&O Insurance Cost?

The cost of E&O insurance varies. The insurance costs will vary based on:

  • The state(s) where the notary conducts business
  • Bonding agency
  • Policy type
  • Years of experience
  • Claims history

Any new notary should contact an insurance company directly to get a specific insurance quote for their unique situation.

Why Notaries Need E&O Insurance

Finding a good E&O insurance plan is an important step in creating protection for any notary. E&O policies provide ironclad protection to keep notaries safe and financially covered from:

  • Legal fees and court costs 
  • The costs of legal defense by an expert in notary law
  • Another party counterfeiting your information and forging your signature 
  • Unintentional violations of notary law
  • Financial damages due to an error or omission

Even if a notary doesn’t make any mistakes, there’s still the possibility that a client could come after them with a lawsuit. Although they’ve done nothing wrong, the legal fees needed to pay to defend themselves in court are substantial.

Having an E&O helps notaries afford everything they need during these unwanted situations.

When Can Notaries Be Sued?

Anytime a simple error is made, it could put a notary at risk for an extensive and expensive legal battle if the error harms a client financially.

Despite the excellent work most notaries do, there are many circumstances in which they can be sued, including:

  • Inaccurate advice given to clients
  • Errors or omissions
  • If someone forged their signature
  • Unintentionally breaking the law
  • Negligence
  • Misrepresentation

E&O insurance will protect a notary and their assets should any of their notarization services come under fire. A word of caution, however, an E&O policy will not cover any intentional acts of fraud or purposeful errors.

E&O Insurance versus Notary Surety Bonds

Most notaries already have something called a notary surety bond. This form of financial coverage is required in most states. While both E&O and surety bonds are meant to cover legal expenses, they do have some differences.

Notary Surety Bond

The main purpose of a Notary Surety Bond is to protect the public and clients, not the notary. A notary can purchase a surety bond (usually at least $5,000 covered) as protection. If a client brings any claim against a notary, the money in the bond will go towards paying the claim. 

However, once the claim has been paid, the notary is then responsible for reimbursing the bond company for the loss and paying back what was paid out themselves. This reassures clients they can be compensated for financial harm caused by a notary’s mistake. These bonds allow members of the public to have better faith in notary services.

For example: A notary would need a surety bond if they made an error on a form, and therefore the client lost out on a business deal. The client would file a claim for the loss, and the notary’s bond would pay the expense.

E&O Insurance

An E&O Policy is meant to protect the notary and their personal assets. With E&O insurance, the notary will never be expected to reimburse the insurance company. The E&O policy—depending on the set limit—will cover legal fees, lawyer fees, court fees, and claims. 

For example: A notary would use this if a disgruntled ex-client sues them for misconduct. The notary can defend themselves in court, and the insurance would cover all the legal fees associated with their case up to their policy limit (so they don’t have to pay out of pocket).

E&O Insurance for Online Notaries

As more legal and business documents are signed and sent online, the need for online notaries has grown substantially. Online notaries can find far more clients and have more opportunities to gain experience quickly because they work remotely and are not limited to one geographical area.

Since this online format of signing documents is even more risky due to online hacking, errors, miscommunications, and misrepresentation, it’s even more vital for online notaries to get E&O coverage. Indeed, remote notaries often increase the amount in their surety bonds (up to  $25,000 more in many cases) to ensure adequate protection.

Become a Florida Notary Today

Working as a notary is a reputable occupation that can support you and your family. With E&O insurance coverage, you can find success in your job while staying protected from any unwanted legal fees or burdens. 
When you decide it’s time to become a notary or you need to renew your notary certification, the Florida Notary Association can help you through the process. Contact us today to find out how we can answer any questions you might have.