Errors with E&O – Part 2
If human beings were perfect, there would be no need for Errors & Omissions coverage. Until we get to the level of expertise suggested, we are fortunate it exists.
An international investment management company hired Do It Right Software Solutions to build a Secure Client Space. In its Scope of Work, Do It Right listed key milestones to create a July 1 “go live” date.
Of course, Do It Right protected itself and encouraged a collaborative process by also listing key client review and approval dates. The client, in an effort to hold up its end of the transaction, met each date indicated on the Scope.
Do It Right’s Chief Marketing Officer championed the Secure Client Space as a critical initiative. To build excitement, he announced the launch date in a client E-letter, through a press release, on the company website and through client calls. He also scheduled a launch meeting at a downtown hotel with key personnel who were being flown in from around the globe.
However, there was a problem; Do It Right was in the midst of a growth spurt. To handle the increased workload, a new project manager had been hired to supervise this and other projects. Although he had been carefully vetted, the project manager was not able to keep up with his workload. Several of his projects slipped, including this Secure Client Space.
On June 23, the President of Do It Right Software Solutions called his client to tell him they would miss the July 1 “go live” date. On June 25 he learned the company he had worked so hard to build was being sued because his team had failed in its professional duties causing the client to suffer a financial loss, the genesis of most professional claims.
To learn more about your firm’s professional liability risk, and to discuss how E&O insurance can help protect it one minute from normal, please contact your relationship manager at KMRD Partners. He can provide advice regarding your firm’s situation.
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