Excess professional liability policy provides additional coverage on top of your firm’s primary professional liability policy.
The excess professional liability policy works similar to an umbrella policy, in that it is an added layer of protection for your design firm. The primary policy will pay first on a claim and if a claim exceeds the primary policy limits, then the excess professional liability will respond. For example, if your firm’s primary policy is $2,000,000 each claim and $2,000,000 aggregate and your firm purchased an excess policy for $3,000,000 each claim and $3,000,000 aggregate. The claim totals $2,500,000, the primary policy will respond to the $2,000,000 amount (policy limit) and then the excess policy will respond to the additional $500,000.
The reason your firm may need excess professional liability is for increased protection. With our litigious society, larger and frequency of claims are occurring. The extra layer of protection for your firm may be helpful in these types of situations. Additionally, your firm may have a contractual obligation for higher limits that your primary professional liability insurance company may not be able to achieve.
There are a few factors to consider when choosing an excess professional liability policy. The policy limits are important to understand, do they meet the contract requirements. The policy terms of the excess policy, verifying that it aligns with the primary professional liability policy. Premium is another factor to review. Does the premium fit within your firm’s budget or will the contract requiring the higher limit be reimbursing your firm for the added expense? Also, you want to make sure that the insurance company is reputable. Such as the following companies:
Great American Insurance Company
If your firm has any questions on an excess professional liability policy please call, or email, your Professional Underwriter agent for assistance.