Architects and engineers face a variety of risks by offering specialized services to a multitude of clients and projects. Without the proper insurance, one simple mistake could land you and your business in an expensive lawsuit.
Professional liability insurance for architects and engineers helps cover costs associated with claims regarding professional negligence. Even the most experienced engineers and architects can make mistakes. Unfortunately, those mistakes can cost you. Professional liability insurance can compensate you or your business for legal expenses should a client decide to sue.
Professional Liability Claims
To paint a clearer picture of how professional liability insurance can benefit architects and engineers, here are a few examples of claims that could be covered under professional liability.
- An architect is hired to design a new section of a high school. When building begins, the client realizes that there has been a mistake in the design. The original cost of the school section was $100,000. Not wanting to repair the mistakes from their pocket, the client files a claim against the architect for faulty design.
- A civil engineer begins a project designing a set of bridges. While they are overseeing the project, one of the bridges falls due to poor foundation. Instead of taking out a claim on their property insurance, the client (either public or private) decides to sue the engineer for negligence, since the project was under their control at the time.
- A flight engineer analyzes planes for a popular company to make sure they are in working order. While looking, the engineer is distracted and fails to notice worn electrical components, which later cause issues during flight and damage to the plane. The client (in this case, the airline) then seeks compensation for the damages.
The Cost Of Professional Liability Insurance For Architects And Engineers
The cost of professional liability insurance depends on a variety of factors. Aside from the industry and profession, this price may also vary depending on:
- Size of business/number of professionals covered
- Coverage limits
A single engineering business may pay around $1,875 a year for professional liability insurance. Architects pay around the same amount, which is about $1,730 a year. Professional liability insurance can often come as an endorsement for a business owners policy (BOP) or commercial policy package (CPP). Bundling insurance policies is a useful way to save money on important coverages.