What is the term for insurance that covers the cost of legal defense for professionals against negligence claims?

The term for insurance that covers professionals’ legal defense against negligence claims is errors and omissions insurance.

Errors and omissions insurance, usually called E&O insurance, protects professionals and service businesses from covered claims that their advice, work, or failure to act caused a client financial loss. A policy commonly helps pay defense costs, settlements, or judgments, subject to its limits, exclusions, and deductible. Defense may be covered even when the allegation ultimately proves groundless, depending on the policy wording.

E&O is a form of professional liability insurance. It is especially associated in the United States with consultants, brokers, agents, technology firms, accountants, and other professionals whose mistakes may cause economic harm without causing bodily injury or property damage. Many policies are claims-made, meaning the claim generally must be made and reported during the policy period, with rules for prior acts and extended reporting.

Malpractice insurance is a closely related professional-liability category, particularly for doctors and lawyers, so it can sound plausible in a broad question. “Liability insurance” is more general, while “indemnity insurance” describes a wider insurance concept. E&O is the most specific canonical answer here.