E&O provides protection in situations where the policyholder makes a mistake (an error or omission) that leads to a financial loss for their client, so the policyholder needs to pay the resulting damages (or potential lawsuit). The loss could be due to professional services or inaccurate advice.
For example, consider a carpet installer. If the contractor picked up the wrong carpet from the dealer and installed it in a customer’s home, the installer would need to remove the carpet, replace it, and cover the costs to fix the mistake.
Who needs it?
E&O liability coverage is beneficial for:
- Heating and air conditioning contractors
- Carpet installers
- Concrete contractors
- Tile, stone, and marble installers
- Communication equipment installers
- Independent agents
- Financial advisors
- And so many more