If you're running an architects business or are about to start one, then you need to ensure you have adequate insurance cover. Professional Indemnity Architects Insurance should mitigate against potential mistakes people may make in your business.
Your insurance should be compliant with the Architects Registration Board (ARB) and The Royal Institute of British Architects (RIBA). The RIAS also state that architects should not undertake professional work without adequate and appropriate professional indemnity insurance cover.
Whatever the nature of your architecture business, from designing and drawing to project management, you may be required to have minimum levels of Professional Indemnity Insurance. Here's an overview of the types required.
Types of Insurance - Compulsory and Optional
As with all professions, an Architect has direct contact with people and companies even if you're operating alone and don't have staff to control. As you're offering professional advice, you have a duty of care over the advice provided.
Sometimes, that may be incorrect for one reason or another and your client may incur a financial loss and may seek compensation for you. That's where certain insurance policies help mitigate the total cost of awards made against you by the courts and cover the legal expenses and costs of any claim.
There are two main types of insurance for architects businesses:
- Public Liability Insurance insures you against injuries to third-parties.
- Professional Indemnity Insurance mitigates against customer mistakes.
What is Architects Professional Indemnity Insurance?
Professional Indemnity Insurance, or PI, covers you against professional business mistakes made through providing expert information where the third party incurs a financial loss of some nature because they used the advice they paid for which later turned out not to be true or a better judgment was available.
It depends on the turnover of your business as to the amount of cover you require, but usually, most companies have a protection of around £1-£2million annually. At this level of cover, a premium of £150-£200 per year usually applies.
It covers the loss to settle any claims, the legal costs and usually includes items such as slander, libel and breach of copyright. Professional Indemnity Insurance is the protection that most architect professionals have as standard.
What is Architects Public Liability Insurance?
Public liability covers you and your business if you deal directly with the public and insures your business against injury or death to a member of the public or damage to their property and covers the compensation payments and legal fees associated with any claims.
If you're an architect who works from home, then it's unlikely you'll need this cover. But, if you go to your clients' offices, place of work or their own home business then it's worth thinking about for additional protection. As most architects work alone in their practice and deal with the public daily, it's a must-have insurance expense.
It's not a legal requirement but most businesses get cover of £2million as the cost of claims is increasing rapidly.
These days the cost of equipment in your architect's office is very high so having office insurance is critical to cover against theft and damage from external factors.
Some policies also allow you to insure against loss of earnings due to business interruption such as flooding or storm damage. Additionally, by choosing office insurance, some insurers also included professional indemnity and professional indemnity cover as well.
So those are the principal architects' insurance products you should consider as life as an architect. Compare quotes online to get the best deal but check the small print for any exclusions or excesses you may have to pay.