Architects, along with engineers and other design professionals, need insurance coverage. Whether they are part of a firm, or working as an individual, if they are accused of improperly performing services that cause a client to suffer an economic loss, this requires errors & omissions insurance (E&O) as a way to mount a defense that can otherwise be quite expensive. Most firms also understand that they don’t have the resources or the expertise to defend against such claims.
Architect professional liability insurance, (also known as errors & omissions insurance) protects architects if a client alleges that they were professionally negligent or in some way failed to perform their professional duties. They may also claim that your firm failed to perform as promised in the contract. Insurance policies are also available for design and consulting departments of contractors as well as independent design consultants.
E&O insurance helps you to protect your business
The fact remains that the high cost of preparing a legal defense could easily put your architectural services firm out of business. Your personal financial security could also be at risk dependent upon what type of policy you have and the provisions within the contract.
Aside from the possibility of becoming embroiled in a lawsuit, there is your valuable reputation that may come under fire and an E&O policy helps protect the valued relationships you’ve developed by protecting, not only your own financial security, but your client as well.
Most architects have experienced having to deal with a disappointed client and know that even a small mistake can end up having serious consequences. Everyone is capable of making an error at some point in his or her career. Whether it involves an equipment failure, or is just a matter of some human oversight, if it results in personal injury, it can also result in a lawsuit.
Having errors & omissions insurance coverage insures that you will have funds to help you through those instances when mistakes blossom into litigation. Some clients may even require that you carry E&O insurance and the right type of policy can protect both the architectural service firm, and subcontractors, from claims of a perceived error or omission, even months after the initial job is completed.