Even the best condo association is vulnerable to human error. As associations are responsible for a wide range of services and duties, chances are high that mistakes will be made. In today’s litigious society, chances are even higher that such mistakes will lead to an adversarial legal proceeding.
The “hold harmless” and indemnity provisions of most management contracts don’t provide adequate protection against many lawsuits. Indeed, without the specific coverage offered by errors and omissions insurance, a condo association may be left unprotected and open to potential financial disaster.
Why E&O and Not D&O?
Directors and officers insurance (D&O) policies protect the association and its board members and volunteers from claims arising from board decisions and policies. Errors and omissions insurance (E&O) policies protect the association and its employees from claims of negligence and failure to adequately perform contracted services and duties.
Due to the nature of the business, condo associations leave themselves open to a number of legal actions. Below are some of the most common types of claims resulting in lawsuits that an E&O policy is designed to protect against:
Don’t leave your condo association unprotected in the event of an expensive legal proceeding. Learn more about the advantages offered by an errors and omission insurance policy.
- Breach of service or duty
- Insufficient or improper communication or documentation
- Mistake resulting in financial loss for resident or owner
- Improper business practice