Why Every Contractor Need To Invest In Error And Omissions Insurance
In Ontario, there was a while when the housing market was down. In fact, almost all throughout the world the housing market dropped greatly, but now it is taking back off again. There was a time when new construction was almost non-existent. However, due to the recent influx houses and buildings are going up everywhere in the Ontario province. This is leading many individuals to pursue the construction and contractor field. Sure, this is a rewarding field that can provide you with an honest career, but before you just jump right into the field you need to know the risks that are involved.
Any contractor is at risk of customer and client disputes, which can lead to lawsuit. Some of the lawsuits can even bankrupt smaller companies. This is why it pays to be protected with error and omissions insurance. While error and omissions insurance can protect you and your company against certain threats there are other threats that it can’t protect you against. This is why it is imperative that you completely understand everything you possible can about error and omissions insurance.
What Exactly Does Error And Omissions Insurance Do?
As a contractor you are providing a service to the community and public. Anytime you provide a service to someone and something goes wrong the one providing the service is going to get the blame. Sure, there are times when you might be a fault and there are times when you might not be at fault. Errors and omissions insurance can come in handy in both of these situation. Anytime one of your customers or clients suffers a finical loss, because of a mistake or incompetency on your part you will be covered. For instance, if you make a mistake on a job that causes your customer to loose money and the customer sues you error and omission insurance can pay for the court costs, lawyer, and settlement fees.
However, if there is a situation when you are not a fault you still might be faced with that same lawsuit. Just because you are innocent it doesn’t mean that you won’t have to spend a great deal of money proving your innocence. Errors and omissions insurance will cover the same fees and court costs that it covered in the above scenario.
Why Should You Purchase Error And Omissions Insurance?
The real simple truth is that no matter how careful or how many precautions you take there will come a time when you make a mistake. It is something that is just going to happen and cannot be avoided. This is especially true if you have several different employees under your wing. You can’t always keep an eye on your employees and the more people you have working for you, the more likely there is to be a mistake. However, with errors and omissions insurance you do not have to worry about making detrimental mistakes, because you will be covered.
As a licensed contractor that provides services to Ontario consumers, you may be required to obtain E&O insurance coverage. If you have any questions about this requirement, you should contact the associated government entity.