Why does an Architect Need Insurance?
Architects are known for their vision. Your ability to see to design buildings and bring them to life is a true gift that clients rely on you for daily. As an architect, you also hold the weight of every project on your shoulders because one missed step or overlooked building code can be devastating to your professional career. Insurance for your architect business is a smart decision and can help maintain your reputation, financial resources, and future projects in the event of a lawsuit.
Professionals in this industry are responsible for the planning and designing of buildings (residential, commercial, and industrial). They are responsible for understanding building codes and materials, and zoning regulations.
Risks Architects Could Face
Architects face many risks on every project including:
- Stolen Materials: In some cases, architects manage the supplies and materials needed to build their design. These materials are often left on site over night, making them readily available to those passing by. Replacing these materials can be expensive if they are stolen mid-project.
- Third-Party Injury: Many job sites are left unattended in the evening. Depending on how accessible it is, kids may be tempted to browse the area. If one of them trips and breaks a leg, you can be held liable for not maintain a safe environment even though they should never have been there.
- Faulty Design: Architects rely on engineering teams to make their design happen. You can still be sued when engineering errors occur because they use your design as their map.
- Overbudget: In the beginning stages of any project there is a budget. Your clients expect that you stick to this budget. If you fail to, you can end up stuck paying the difference because you breached your agreement.
- Destruction of Files: These days most designs are completed electronically. What happens if your digital files are destroyed? How much time will you need to reinvest if you don’t have a backup? How much will that cost your business?
Types of Coverage Architects Need
In addition to basic general liability insurance, every architect needs errors and omissions insurance. If you have employees, you also need workers comp and employment practices liability. If your firm has business vehicles or employees drive personal vehicles to job sites, commercial auto insurance is a must.
- Errors and Omissions: Also known as E&O or professional liability, this covers you for any potential mistakes including breach of contract, budget issues, faulty design, or any other decision that causes a bad outcome for your client.
- General Liability: Protects when a third-party is injured on your property by paying medical bills, settlement, and defense costs. It also includes coverage for damaged property and libel and slander claims.
- Commercial Property: Covers all of the property you own to run your business from acts of nature like fires and theft.
- Cyber Liability: Pays costs associated with cyber breaches including notifications, public relations, and investigations. Some also includes coverage for replacing digital assets like designs when they are accidentally damaged.
How Much Does Architect Insurance Cost?
Every carrier has a different opinion on insurance for architects. Some avoid your industry altogether. The majority will want to know your safety procedures, what types of contracts you use, and your experience. Cost is also impacted by whether you buy architect errors and omissions insurance. You request an insurance quote online today for the policies you need most by clicking on the form below.