Why You Need Errors And Omissions Insurance

Sep 19, 2019, 3:12 PM

To err is Human; to Forgive, Divine. – Alexander Pope

We all make mistakes, but some are more serious than others. A mistake can be expensive if you’re a professional contractor and you’re working with poor-quality materials, or if your crew doesn’t do the high-quality work you expect them to.

Errors and omissions insurance, better known as E&O, is what you need if something goes wrong — if there’s an error (a mistake), omission (something accidentally left out of an agreement), or negligent act (something that was missed or not reported).

But what about a general liability policy, another similar type of policy that Hastings Mutual also offers? General liability coverage is just that: general. It applies to most situations a business owner might be in, like a homeowner who’s accidentally hurt by one of your employees. It can also apply to injuries caused by advertising — not from a falling billboard, but libel, slander, or other written or spoken harm. There’s a lot more to it, but putting it simply: general liability has to do with getting injured, damaging property, or causing harm to a company’s reputation. E&O has to do with making a mistake.

E&O is common for professionals in many industries — insurance companies have E&O coverage for themselves — but Hastings Mutual specializes in E&O for contractors and for mechanics. Why? It’s a field with many workers who deal with a lot of risk every day. We’re also familiar with contractors and mechanics and the kind of work they do; we offer coverage for several different types.

We encourage every business customer to talk with their independent insurance agent about errors and omissions coverage. A contractor might not think of it when buying their insurance; a builder will definitely need protection if someone is hurt on the job, but they might assume the costs of repairing a mistake are just part of the cost of doing business. Mistakes are made, but the expense of getting the job done the right way doesn’t have to fall on a contractor or mechanic’s shoulders.

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