claims trendsProfessional Liability claims trends for Design Firms.  The more information your firm has about the types of projects, claimants and types of claims the better prepared your firm is.  With this information your firm can increase your risk management efforts or have a more selective client/project selection process.

Claims by project types – This does vary with architects and engineers.  More condo claims are reported for architects, while the frequency for engineers is houses/town homes.  Residential (condos, town homes and single family residential) for all types of design firms have the highest frequency and severity (dollars spent) of claims.  After residential, schools/colleges have the highest frequency and severity of claims.

Claims by discipline – Architects have a slightly higher claims frequency over engineers.  The reason architects claims are slightly higher is because architects are generally the first point of contact with the project owner and are responsible for carrying the master agreement.   However, more specifically with engineers, geotechnical and structural engineers have higher claims frequency than other types of engineers.

Frequency of claims by claimant – About 60% of the claims come from the project owner.  The reason most of the claims are coming from project owners is because that is the most common type of client design firms are working with.  The subsequently percentages of claimants are coming from General Contractors (9%) and Third Party Property Damage (8%).

While your firm has to make decisions on a daily basis as to a project/client type it is important that you are aware of the risks involved.  The best way to protect your firm is to have strong risk management procedures in place and a Professional Liability insurance company you can rely on.

PUI Agency is here to help with questions or provide information to help with decisions and risk management.