If you do business with a professional and that person or business makes an error which causes you harm, you may be able to file against their Professional Liability insurance policy for what is called an “Errors and Omissions” or E&O claim. Nearly all professionals carry such insurance coverage as it protects their business and themselves from the responsibility of using their own assets and resources to pay a claim. This type of policy will not, however, cover every wrongful act. Intentional acts or ones which violate the law are not covered. Claims for bodily injury for negligent conditions on the business premises will also not be covered under this type of insurance.
An E&O policy will cover a business or professional for negligent acts performed which result in damage to the customer in the form of monetary losses, property damage, physical or psychological harm.
An example of an E&O claim against an insurance agent would be the following scenario. Jack and Rachel owned a mixed-use building. On the top floor was a residential apartment and on the bottom was an art gallery. When they spoke to their insurance agent about insuring the property they explained the building was used for dual purposes, both residential and commercial.
They paid for the policy and a year later had a fire in the building causing a total loss of both the apartment and the business below. When they made a claim to their property and casualty insurer for the loss, they were shocked when the claim was denied. When they contacted their insurance company to find out what the problem was they were told that they did not have the right coverage for this type of mixed-use property. The agent had made a mistake when he wrote the policy and neglected to include this information.
Jack and Rachel’s loss was not covered due to the negligence of their insurance agent, so they filed a claim against the agent’s E&O carrier. The agent’s insurance company initially refused to pay the claim because the agent contended that Jack and Rachel never told him the property was used for both residential and commercial purposes. As a result, Jack and Rachel were forced to file a lawsuit against the agent’s insurance company. After a trial, Kennedy Law was able to obtain a substantial verdict for the clients, plus an award of attorney’s fees. We may be able to do the same for you.
With over forty years of experience, our team at the Law Offices of William T. Kennedy, P.C. has helped countless people obtain help and deserved compensation. Contact us at (877) 985-3473 today for a Free Consultation to find out your legal options with any one of our experienced E&O lawyers.