Itís Time To Add Errors And Omissions To Your Building Insurance - Farmer Brown Insurance Agency - Contractor Talk

Itís Time To Add Errors And Omissions To Your Building Insurance

 
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Old 05-28-2020, 07:03 AM   #1
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Itís Time To Add Errors And Omissions To Your Building Insurance


Itís Time To Add Errors and Omissions to Your Building Insurance

Does your building insurance include Professional Liability coverage? The US is a litigious society. Every contractor is likely to be faced by a claim or two. Youíve got this covered, right?

You may think that your General Liability Insurance and Workers Compensation is enough coverage. Your insurance company could have advised you that this is all you need. Maybe that was so at the time, given your budget and your business circumstances. But it could have changed. It could be time to reassess your building insurance.

Letís take a look at why Professional Liability Insurance can fill a big gap in your coverage.

Contractors General Liability Insurance

Weíre all aware of the purpose of Workers Comp, so letís move on to General Liability. There are 3 common reasons why contractors invest in Contractors General Liability Insurance.
  1. It is mandatory across the states.
  2. Clients wonít hire your business unless you have third party insurance. They donít want to experience unnecessary financial losses.
  3. You know the dangers of construction work. You canít afford to lose your livelihood and your business. This can happen as a result of huge claims from clients or other third parties that experience bodily injury or property damage.
But do you have protection for these claims?
  • Negligence in providing professional services
  • Incomplete work
  • Errors
  • Oversight
  • Failure to deliver services
If the answer is no Ė and it will be if you only have General Liability coverage Ė then your business is in danger.

Letís recap: Your General Liability Insurance is for third party claims. Your Workers Compensation is for employee injuries. You may even have Builderís Risk, which is coverage for theft of your equipment and loss of your profit.

But a client may claim that your work is incomplete, inaccurate, or negligent. Are you prepared for this kind of lawsuit?

What is Professional Liability Insurance?

Professional Liability Insurance (also known as Errors and Omissions or E&O) is liability coverage that protects the value of your work if it is damaged due to unintentional, faulty workmanship. It covers the cost of lawsuits including covers settlements or judgments rewarded to the client as well as your legal costs.

Bear in mind that it may be difficult for a client to collect a settlement or judgment if donít carry E&O insurance. However, you shouldnít breathe a sigh of relief just yet.

Your business can still experience substantial financial losses in a case like this. You could easily find yourself being awarded fewer and fewer contracts. But why? What is the connection between Errors and Omissions Building insurance and getting more work?

So, do you really need E&O Insurance?

Of course, this will impact your business reputation. How? Word of mouth is the most powerful of marketing. Your good business reputation can be destroyed by negative word of mouth. This happens when family, friends and colleagues ask for recommendations. Even more powerful are online reviews because they are easily found and stay around forever.

Choose your building insurance with care

If a client claims your work is incomplete, inaccurate, or negligent, the insurance company providing E&O insurance is contacted. This is why it is important to choose your insurance company carefully. Will they be there for you with quick and knowledgeable assistance when you need it most?

Farmer Brown Insurance can help. Speak with us for a building insurance assessment. Call (888) 973-0016
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