Differences Between Professional Liability and General Liability for Architects and Engineers
These policies are different but both necessary in the business of design professionals.
Professional liability is for design errors and omissions for architects/engineers. General liability is for risks such as bodily injuries and property damage.
The risk for architects and engineers is higher with the design errors and omissions and therefore the premium tends to be higher on the professional liability policy. General liability is a lower risk for design professionals, unlike general contractors, and therefore the premium is lower than professional liability.
Professional liability is a claims made policy. Meaning that whenever the claim is made the policy that is in place at the time of the reported claim is the policy that will respond. General liability is an occurrence policy, meaning that the policy that is in force at the time of the occurrence is the policy that will respond.
Professional liability the defense costs are within the limits of liability. General liability the defense costs are outside of the limits of liability.
Professional liability policies do not have umbrella policies over and above the practice policy. Your firm can purchase higher limits of liability or a project endorsements for higher limits on a specific project. General liability has an umbrella or excess policy your firm can have over and above the general liability limits.
Professional liability policies tend to have more frequency of claims for design professional because that is the higher area of risk. Whereas general liability does not have the same frequency of claims.
Professional liability policies do not allow for an additional insured. General liability frequently has additional insured requests and most policies have a blanket additional insured endorsement for architects and engineers.
As always, read your firms professional liability and general liability policies. If you have any questions with regards to the different policies please call or email your Professional Underwriters agent for assistance.