Risk and Interior Design
As an interior designer, you make a living out of helping others reimagine and renovate different spaces. That can include living spaces as well as offices, government buildings, art galleries or museums. All interior designers offer both consultations on design ideas, as well as assisting with making the right purchases with regards to the furniture, design materials and contractors needed to turn these ideas into reality.
These activities all carry some associated risk. Even the best interior designers face the potential of unhappy clients considering their business to be liable for mistakes or accidents. Consider the potential benefits of having different insurance policies on hand in case the unexpected does occur.
Business Owners Policy (BOP)
Interior designers who own property face additional risks associated with the business. While many interior designers do work out of the home, many successful interior design businesses utilize large business spaces and sometimes even large warehouses. This equates to significant monetary investments in property, all of which could be at risk of a loss or could be a potential hazard for clients passing through your offices, warehouses or showrooms.
If clients are ever injured accidentally while on your premises, you could be liable for bodily injuries. This is where a Business Owners Policy comes in, helping you to mitigate the risk. Alternatively, if something happens to your business property, such as a fire or theft, a BOP will help to cover the cost.
Errors and Omissions (E&O)
Perhaps one of the most important policies for interior design specialists. An E&O policy helps cover the costs associated with giving advice to clients. When an interior designer makes suggestions on how to reorganize or transform a space, he or she is taking on the responsibility for the money that will be spent. If a customer feels that money was spent frivolously or that the suggested changes were not properly thought out, the customer may try to hold the interior designer liable.
Interior designers may also face claims if a client believes the changes made to the space were inadequate, or if those changes resulted in an unexpected and undesired consequence. For example, if a customer wants a living room redone before the birth of a new baby, the parents may give the interior designer the task of revamping the space to make it more child-friendly. However, if the parents later determine that the living room space they paid to have redone still contains safety oversights, the fault may lie with the interior designer. E&O insurance is designed to mitigate the costs of any such oversights.
Hired & Non-Owned Auto
If your or an employee uses a personal or rented vehicle for business purposes, Hired and Non-Owned Auto insurance can be quite valuable. Essentially, it offers liability coverage in the case of an accident or vehicular incident while employees are driving on-the-job. As an interior designer driving to visit clients' spaces and evaluate products, it's important to make sure your business is protected as you drive.
What type of insurance does this industry need?
- General Liability: This policy protects your business in case of third party claims, such as bodily injury or property damage. For example, the common "slip-and-fall" claim would be covered by your General Liability policy. General Liability insurance is often considered to be the core coverage, particularly for businesses that regularly physically interact with customers or sell physical goods. In addition, many businesses have a contract, like a loan or a lease, requiring that they have this coverage.
- Professional Liability: This policy, common in the professional services industry, helps to protect your business if a client believes they've suffered a loss due to a mistake or error made in a professional capacity. Your business may have contracts with clients or partners that require Professional Liability coverage, provide a "warranty or guarantee," or have clauses that require you to "indemnify or hold harmless" your clients. If so, Professional Liability coverage is often recommended. This coverage is also commonly recommended for any businesses providing advice related to legal or financial matters.
- Workers Compensation: Workers Compensation covers an employee's lost wages and the cost of resulting medical treatment if they suffer a work-related injury or disease. It also covers services needed to help the employee recover and return to work. Workers Compensation coverage is mandatory in most states. The number of employees after which it's required differs by state, but you will generally need coverage once you have employees.
