As an architect you have to consider properly protecting yourself and your investment. That means purchasing architects professional liability coverage, which protects your firm and employees against claims alleging negligent acts, errors, or omissions in the performance of architectural services. This is different from commercial general liability, or CGL insurance, which covers the types of accidents or property damage that could happen at any business, like slips and falls. What’s more, professional liability policies are as specialized and diverse as the variety of professional practices that exist, so it’s key that your policy is specifically designed for architects.
Additionally, it’s important to understand that many factors can lead to a claim for which you can be held liable for, such as:
- The negligence of contractors and others working on a project
- Negligence claims based on faulty cost estimates or delays in construction
- Claims based on planning or feasibility studies that do not require that you be the architect of record for a project, or
- If you bring a suit to recover fees, you could be subject to a counterclaim that you were somehow negligent
In general, professional liability claims are more likely to be the result of a failure to manage expectations than due to a spectacular construction failure, particularly where the client has little experience with other construction projects. Their understanding of what comprises an architect’s scope of work and the quality and timing of the final product may be unrealistic, but that does not prevent claims from being filed and even going to trial or arbitration. And even if they don’t make trial, you have the defense costs, which a professional liability policy will cover.
A number of factors go into establishing the premium for a particular design firm’s policy, including:
- The firm’s primary project type
- Claims history
- The use of standard written contracts
- Specialty coverage, and
- The extent of coverage required for prior acts
Having architects professional liability insurance coverage will aid the serious professional that wants to protect their valuable assets from unforeseen litigation. Be sure to discuss this must-needed coverage with an independent insurance agent.