Insurance & LiensQuestion 474 of 1605
A design-build contractor makes a professional design error that causes a client financial loss but no bodily injury or property damage. Which coverage is specifically intended for this kind of claim?
a.Commercial general liability insurance
b.Workers' compensation insurance
c.Errors and omissions (professional liability) insurance
d.The $25,000 contractor license bond
Explanation
Errors and omissions (E&O), or professional liability, insurance covers financial losses to clients arising from negligent professional services such as design errors. A standard CGL policy typically excludes purely professional negligence.
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Sen Lin, PrepPass Founder · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)