As the owner of a construction company, you may wonder how you can protect yourself against litigation from an unhappy customer in North Carolina. One option you have is professional liability insurance. However, you should understand what this will and will not cover because it cannot protect you in many situations. Once you understand this, it can help you to ensure you do have the right insurance coverage to protect your business.
To begin with, IRMI explains professional liability insurance generally only covers damages that are solely economic. So, if there is a claim for injuries, your insurance will not cover that. Some examples of what it will cover include are costs to redesign a project or your failure to meet professional standards. It may also cover issues with delays.
Generally, your professional liability insurance will not cover errors and omissions. It also will not usually cover breach of contract claims. Design issues are often a different matter completely. They typically fall to the designer or architect, so you should not have to worry about them. However, your professional liability insurance or some other insurance you carry may provide you with limited coverage if you have any liability for design issues.
You should make sure to read your policy and know exactly what your professional liability insurance will cover. This will allow you to add additional insurance coverage or policies to ensure you are fully covered in the event a customer files a claim against you. This information is for education only. It is not legal advice.