Liability for Faulty Workmanship
An allegation of defective workmanship, whether yours or that of your apprentices, employees, subcontractors or agents could leave you exposed to thousands of dollars of liability, legal costs and damages.
No single policy currently covers faulty workmanship, as it will depend on the kind of loss that has been caused by or flows from the alleged faulty workmanship.
FAULTY WORKMANSHIP CAUSING PHYSICAL PROPERTY DAMAGE OR LOSS – PUBLIC LIABILITY INSURANCE
Physical property damage or loss caused by faulty workmanship can be covered by taking out an extension to your public liability insurance.
FAULTY WORKMANSHIP CAUSING FINANCIAL LOSS ONLY – ERRORS & OMISSIONS INDEMNITY
If the poor workmanship has not caused physical property damage or loss, but instead is alleged to have caused a purely financial loss, then Errors & Omissions Indemnity cover is required.