Why did my premium increase?

Why did my architecture/engineering firm’s professional liability policy premium increase?

There are several factors that go into rating a professional liability policy premium, here some examples of why your firm’s premium may have increased.

An increase in billings can have an effect on your professional liability renewal premium. This will vary with each insurance company because each company uses different averages in determining the billings for your firm. But if your firm’s billings have increase it is likely that the premium will increase.   There are some insurance companies that will also look at your projected billings for the upcoming year and this can also have an effect on the premium.

A change in project types can increase the premium. Again, this will be different with each insurance company, as they rate project types different. But if your firm was designing office buildings on the previous policy period and it has changed to residential, this may increase your firm’s premium.

If your firm has a claim open, claim settlement or a frequency of claims this may increase your firm’s professional liability renewal premium. This doesn’t mean that if your firm has one or all of these that it will increase the premium, but it may have an effect on the premium. For example, if your firm has an open claim but there is not a claim reserve then this may not affect your premium. Also, a claim settlement doesn’t always mean that it will increase the premium. However, the insurance companies do take into considerations the claims history when coming up with a renewal premium.

If there have been any other changes to your firm, this can also potentially increase the premium.   Such as a change in disciplines, change in written contracts, risk management practice changes or firm ownership changes.

If you have any questions with regards to professional liability renewal premium changes please call or email your Professional Underwriters agent for assistance.premium increase



Previous Post
Mediation Deductible Credit
Next Post
Professional Liability Pre-Claim Assistance