In property management, which type of insurance specifically protects against claims of negligence or failure to perform?

Errors and omissions insurance is specifically designed to protect property managers and other professionals from claims arising out of negligence or the failure to perform their duties as outlined in a contract. This type of insurance covers legal costs and any settlements or judgments that arise from lawsuits related to alleged mistakes or oversights in professional services provided.

In the context of property management, this might include issues such as failure to properly maintain a property, neglecting to perform necessary tenant screenings, or any other service-related claim that suggests a lack of due diligence or professional care. Therefore, having this insurance is crucial for property managers to safeguard against potential financial losses incurred from these types of claims.

General liability insurance, while important, primarily covers claims related to bodily injury and property damage that could occur on a managed property. Workers' compensation insurance is focused on providing benefits to employees who suffer work-related injuries or illnesses and does not address professional negligence. Property insurance protects the actual physical properties against risks such as fire, theft, or natural disasters and does not cover claims of professional errors.