Choosing Limits on Policies for Architects/Engineers
It can become difficult to know what limits on policies that make sense for your firm. It will vary from policy to policy and the size of your firm.
Workers compensation limits will depend on the state your firm is domiciled. Some states require higher limits than other states as the minimum. Your firm may also have contract requirements for a specific limit amount for the workers compensation policy.
General and automobile liability limits will commonly be $1,000,000 or $2,000,000 per occurrence and $2,000.000 or $4,000,000 aggregate. This will depend on your firm’s size and the insurance company availability of limits within their underwriting guidelines.
Umbrella limits will be determined from the general limits carried. For example, if your firm wants a $5,000,000 umbrella and your firm has a $2,000,000 general liability limit, the insurance company may limit the umbrella to $3,000,000, again depending on their underwriting guidelines.
Professional liability limits are probably the trickiest because there will be more options available. However, you can determine the limits based on what firms that are similar to your firm’s size are carrying for limits. Another determination are the project size your firm is designing. Again, there will be specific underwriting guidelines with each insurance company as to the limits available.
Overall when your firm is determining limits there are a few factors that will need to be considered. What is affordable for your firm with regards to limits with each type of policy? Also, contract requirements may be a driving force with regards to the limits required.
There is not a cut and dry answer as to what limits your firm will need on each insurance policy. The key is to best determine based on your firm’s needs. If you have any questions with regards limits on policies please call or email your Professional Underwriters agent for assistance.