Comparing A/E Professional Liability Policies
What to look for when comparing Professional Liability policies for Architects and Engineers –
There are many factors when considering a Professional Liability policy and price isn’t always the number one factor. Here is a list of items to keep in mind when comparing Professional Liability policies:
What is the rating of the insurance company? The ratings by AM Best determine the financial strength of the insurance company. This is a good resource to verify your firm is with an insurance company that is financially sound.
What is the definition of professional services? Verify, especially if your firm offers services a little outside of the A/E specialties, that the service covered under the policy. If it isn’t the insurance company may be able to provide an endorsement at an additional cost that would cover that service.
Does the company offer risk management services? This may or may not be important to your firm, but many insurance companies offer risk management services. These services may include webinars, free pre claims assistance, newsletters and contract reviews.
Does the policy have a hammer clause? Also known as the consent to settle clause, it states if/when/how a claim will be settled. Will the insurance company settle without your firms consent?
What is the Extended Reporting Periods (ERP)? Also known as the tail policy, what is the longest time period the insurance company willing to offer in the case the policy is not renewed by you or the insurance company. Do they offer, one, two or five years?
What supplementary payments does the company offer? For example, does the company offer crisis expense reimbursement, defendant’s expense reimbursement, disciplinary proceeding reimbursement and ADA/FAH/OSHA regulatory administrative action reimbursement, to name a few.
What deductible are they offering? The deductible will depend on the insurance company and the size of your firm. They may also offer first dollar defense deductible for your firm.
Most importantly, be sure to do a little research on the company to have a better understanding of who you are insured by. Also you may ask your PUI Agent for additional information about the insurance company, please call or email with questions.