There are many people in Haliburton who provide professional or quasi-professional services to people in the County. The service person could be a contractor building a home, or a real agent selling a home, or a fuel company filling an oil tank for the winter months. All of these service people must perform their services adequately, that is, within the normal standards of their business. There are occasions, however, when mistakes are made by service people. The roof to the new home is not built with engineered trusses and cannot take the snow load. The real estate agent makes a reckless representation exaggerating the acreage of the property for sale. The fuel company fills the oil tank but the tank overflows and causes oil to seep into the basement.
These types of mistakes may give rise to a lawsuit against you for alleged negligent performance of your services. Many people in business have liability insurance to respond to such a lawsuit. Indeed, every prudent business person who is in the service sector providing professional or quasi-professional services should have such insurance. Otherwise, you expose your home and your savings to seizure after a judgment.
There are good things and bad things about insurance companies. Liability insurance provides you with a lawyer to defend you in a lawsuit and the insurance company pays for the lawyer. As well, if you are found to be negligent in your services, the insurance company will pay for the losses covered under your policy. However, what many insurance companies do is try to escape from their obligations under the insurance policy even though you have paid for the insurance. They may try to do this in many ways. One common way is that they will say that you did not notify them about the claim against you in a timely fashion. A liability policy is a “claims made and reported” policy. When your customer says that you were negligent, this is the time to claim under your policy. You must notify your insurance broker as soon as possible so that they are not prejudiced in their investigation of the claim by the passage of time due to late reporting. A common mistake made by professionals and trades people is that they do not report the claim when they should. You may think that the customer is not serious about the claim or that the claim is really small and you do not want your premiums to go up as a result of reporting it. However, your assessment of the situation may come back to haunt you when you are sued a year later and your insurance company refuses to get involved. Before you know it, you have paid a lawyer many thousands of dollars to protect your home and savings and you have also sued your insurance company.