Thanks, Michael.
I wanted to know an approximate order of magnitude of possible range, and I got that. Not as bad as I had imagined.
The reminder that insurers use previous billings, as well as the balance between "consulting" and "real work", for calculating premiums, was also helpful.
And, the suggestion by others to taper down one's activity, before totally terminating, is also helpful; for a combination of less exposure, lower billings for insurance calculations, and also getting adapted to a different income level.
Washington has a 7-year statute of limitations. I shorten that by several years in my Owner-Architect agreements, so that also helps to reduce how long of a tail I might need.
One of the advantages of insurance - well, my policy at least - is "first dollar" coverage by the insurer if there is a claim, so paying for the tail is a good thing in my mind (and for familial peace). I'm well beyond 7 years since my separation from a firm where I was a principal that had possibly more exposure to claims, so that concern is past.
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Joel Niemi AIA
Joel Niemi Architect
Snohomish, WA
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Original Message:
Sent: 05-11-2022 05:59 PM
From: Michael Strogoff
Subject: Transition to retirement
Joel and others. Most professional liability insurance policies include indications of premiums for extended coverage. However, I have collaborated with firms that were subsequently told that these are "minimum" amounts and subject to increases based on a firm's specific situation and claims history. Best to get something in writing directly from your agent if you are thinking about purchasing an extended reporting policy.
Stay tuned for an upcoming video "Start Your Transition Plan While You Still Give a Sh_t"
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Michael Strogoff, FAIA
Strategic Advisor
Chair Emeritus, PMKC Advisory Group
Strogoff Consulting
Mill Valley, CA 94941
Original Message:
Sent: 05-10-2022 08:51 PM
From: Joel Niemi
Subject: Transition to retirement
I'm getting close to this being very relevant myself.
I do enjoy what I'm doing, and the idea of not being active as a practitioner seems strange. I imagine I might get over that. Might want to maintain my registration, even if not practicing actively, long enough to design that one-last-house to retire in, since being recognized as an architect does have a bit of sway with plan reviewers and building departments.
Terre, one thing that would be interesting to know would be what your insurance broker has quoted as the cost for the extended insurance coverage after you close up shop. Could you share that with us, just as a multiple of what you're paying now for professional liability coverage? 3x a year's worth? Similar for general liability, if there is an issue for statute of limitations?
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Joel Niemi AIA
Joel Niemi Architect
Snohomish, WA
Original Message:
Sent: 05-09-2022 05:35 PM
From: Noemi K. Avram
Subject: Transition to retirement
Terre,
I am exactly in the same situation and anxious to read what others have to say or recommend. You have verbalized it as if it were my own thoughts.
Original Message:
Sent: 4/30/2022 2:55:00 PM
From: Terre Meinershagen AIA
Subject: Transition to retirement
Hello,
Any advice out there on transitioning to retirement? Although my firm is incorporated, I essentially act as a sole proprietor and will be closing my doors as I finish current projects over the next year or two. I wouldn't mind continuing to work some, as more of a design consultant, but my overhead with E&O and business liability insurance, dues, etc. chews up an inordinate amount of my gross fees when I only take in a small amount of work. My insurance carrier offers an Extended Policy coverage, but this seems pretty expensive given my projects are typically low-risk residential and I've never had a claim. Any recommendations, comments from experience, etc would be appreciated
Terre Meinershagen, Architect
AIA, LEED AP
terre@rockingmdesign.com
2124 Greenough Drive Missoula, Montana 59802
(406) 214-0547 www.rockingmdesign.com