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E & O Insurance

  • 1.  E & O Insurance

    Posted 09-18-2018 19:30
    Not sure if asking this question is problematic or not, but here goes:
    I am a sole proprietor architect/civil engineer (doing structural design for other architects and designers).  Most of my work is residential, both for the architecture and engineering aspects of my projects.  I've been insured with State Farm for years.  Lately, I've been solicited for renewal quotes by other insurance companies, including Hiscox.  I've never had claim and therefore have never dealt with an insurance company (other than paying my premiums), but I was wondering if anyone had good things or bad things to say about the various insurance companies out there, while I am deciding who to provide my coverage for next year.

    regards,
    patrick


    patrick marr, aia pe  architecture + structural design
    2105 gillespie street
    santa barbara, ca  93101
    p:  (805) 898-2096


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  • 2.  RE: E & O Insurance

    Posted 09-19-2018 17:36
    I always have good luck going through a good professional insurance broker that specializes in Architects and engineers.  They provide at least 3-4 fee proposals. There was a huge cost difference, i was shocked. They also provide good advice for contractural issues that come up,  and  agreement reviews if needed. I am a sole practitioner, and i have many contract Architects/draftspeople, etc. And you must say that you NEVER do condos. Your EO insurance rate will triple.

    --
    David E. Christensen AIA, LEEDap
    Architect and Planner
    Christensen Design Management
    P.O. Box 5068, 1108 11th Street, Suite 304B
    Bellingham, WA 98225
    Office: 360-676-4800, Cel: 360-319-5333

    cdm@masterplanning.com
    http://www.masterplanning.com/





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  • 3.  RE: E & O Insurance

    Posted 09-20-2018 17:36
    ​https://www.statefarm.com/small-business-solutions/insurance/specialty-liability

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    Richard Todd AIA
    Marietta, Georgia 30068 GA
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  • 4.  RE: E & O Insurance

    Posted 09-20-2018 23:26
    I have been going through a broker here in Colorado that has given me multiple options and I would also recommend that avenue. Travelers has always been the winner and this month when I renewed they told me they didn't even bother to get quotes from other carriers because they couldn't get close. I also checked with my Allstate broker and they couldn't get close to my previous years' premiums. On top of it, the premium went DOWN considerably and I also qualified for a "Pick-Your-Premium" program in which I could get a guaranteed yearly premium for three years (as I had been doing) but without committing to all three years in the event I chose to close my business.

    Last year a client and his builder got into a lawsuit. I was not a party but was requested by my client to testify. Travelers provided me with free, high quality representation just to make sure I didn't get myself in trouble and coached me before trial and met with me, my client and my client's lawyer several times. I am sure it would have resulted in a few thousands of dollars if I had to pay it myself. It also provided a great relief to me and I think my client as well.

    And even after that, when I renewed, my premium went down!

    They also provide free legal educational seminars for CE units.


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    David Swoboda AIA
    Architect/ Principal
    DF Swoboda Architecture
    Boulder CO
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  • 5.  RE: E & O Insurance

    Posted 09-21-2018 11:06
    I agree with David about using a broker--they can be a real resource.   However, if you are a sole practitioner you might talk to your lawyer about going without E&O insurance.  This is especially true if you mostly do houses.  Although I am recently retired (partly) I went for over 30 years without it.

    My very knowledgable attorney at the time said  "Look, no lawyer is going to tell you not to have insurance.  But the reality is that it makes you a much more visible target."

    I had a contract that limited my liability to the value of the services that I provided.  It had a few other restrictions as well.  I was never sued but was very proactive in settling the very few complaints that I had from clients.  Always had a budget line of about 10K that could be used for settling complaints.   In reality, the only complaints that amounted to anything were from a few  clients who didn't want to pay the last bill.

    It should be noted that my practice was based on hourly charges.

    Did a few condos in the late 80s/early 90s and had to have insurance for that.  But after that, even though I stopped doing condos because I didn't like the relationship and I didn't like the risk exposure,  my insurance would have still been crazy high.

    Anyway--talk to your lawyer.  But it should be one who knows about the architecture business.

    Goog Luck

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    Robert Knight AIA
    Knight Archtitect LLC
    Brooksville ME
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  • 6.  RE: E & O Insurance

    Posted 09-24-2018 22:40
    After I was pushed out into the cold, cruel world (from an ownership position in a 35-person firm, which became a 24-person firm in one day) and decided that since no one was hiring, I'd have to become a sole practitioner, I contacted the broker for my former firm.  A great guy, very knowledgeable about all sorts of insurance, and I would have liked to continue the relationship.

    But his fee quotes were ... well, about 2x another source's.  I asked him about it, and he said "I cna't get that low - but be sure that whoever you're talking to isn't headquartered in the Bahamas or some other off-shore place."  They weren't, and I've benefited from good rates since.  Discount offered if I take their on-line courses for risk management (I do).  Multiple year renewals at fixed rates, nice.  At some point I will probably be talking with them about "tail" coverage when I close up shop.

    That's all on the Professional Liability side.  It's a "first dollar" policy so they cover from the beginning of a claim.  No claims so far.

    You also need General Liability coverage.  My (Traveler's) plan has some coverage for electronic mishaps, so a few years ago when I opened an email with the "locky" ransomware in it, they covered most of the cost of restoring.  No, they wouldn't pay the ransom, but they paid to try to get things back (fruitless) and their IT consultant came up with the name of a service which was able to crack it.  [To this day, I suspect that they paid the ransom, then marked it up for the insurance company ...]

    My agreements say that my liability is limited to fees paid.  Note that doesn't say anything about legal costs - which a good insurance company will jump in to handle.

    And I don't do condos.  And I rely on gut feelings with some clients that I'm glad to "be too busy for".

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    Joel Niemi AIA
    Joel Niemi Architect
    Snohomish, WA
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  • 7.  RE: E & O Insurance

    Posted 09-25-2018 19:53
    The insights and knowledge shared by this AIA community discussion is an added value I enjoy as a small firm owner.  Do keep up the good discuss. Thank you.

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    Ato Apiafi AIA
    Principal
    Ato Apiafi Architects, PLLC
    Bellevue WA
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  • 8.  RE: E & O Insurance

    Posted 09-19-2018 19:06
    I'm not aware of State Farm providing E&O. I thought they only provided general business insurance policies. If they do provide an E&O program I'd like to know more about it.

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    Steven Canter AIA
    Prescott AZ
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  • 9.  RE: E & O Insurance

    Posted 09-20-2018 21:58
    State Farm Specialty Products for E/O have had for 10 years,
    No claims, No complaints -

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    J. Tate AIA
    President
    Tate Architecture PLLC
    Kernersville NC
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