What insurance do architects need and why?
Architects need professional liability insurance which protects them against a variety of risks inherent in their profession:
Accusations of professional errors and omissions
Architects provide complex professional services, and even with the utmost care and diligence, errors or omissions can occur.
Client assurance
Clients often ask that their architect is appropriately insured. Having architect professional liability insurance in place can provide assurance, making clients more likely to trust and work with you.
Financial stability
Architects' professional indemnity insurance, in combination with other essential covers, safeguards the architect’s financial stability. In the event of a significant claim, the insurance ensures that architect can continue their business operations without jeopardising their personal assets.
Architects Registration Board (ARB) requirement
Architects registered with ARB are expected to cover their professional liabilities through professional indemnity insurance.
Royal Institute of British Architects (RIBA) requirement
Architects registered with RIBA have the obligation to have at least £250,000 of professional indemnity insurance.
Architects' professional indemnity insurance
Also known as architect professional liability insurance, professional indemnity insurance is a critical component of risk management for architects. It helps protect both their professional integrity and their financial well-being, ensuring that they can continue to provide their services with confidence.
Do architects need professional indemnity insurance?
Professional indemnity insurance is a key cover for architects. Even a small error or negligence can lead to financial losses for clients. Without the protection of professional indemnity insurance architects can find themselves in an extremely changing situation if a client decides to pursue a legal claim.
Architect trade bodies in the UK such as Architects Registration Board (ARB) or Royal Institute of British Architects (RIBA) recognise that architects are entrusted with significant design responsibilities affecting practical as well as ethical outcomes. As such one membership obligation is to have adequate professional indemnity insurance.
What does architects' PI insurance cover?
Architects' professional indemnity insurance provides cover for various liabilities and risks that architects may face in the course of their professional services. The specific coverage can vary based on the insurance policy and provider.
In the event of a significant claim, architects' professional indemnity insurance maintains the continuity of their business by covering financial liabilities. This is particularly important for small to medium-sized architectural firms.
Cover responds to client accusations of:
- Breach of your duties
- Acting negligently
- Failing your duty of care
- Making an error
For example, a client or a third party may accuse you of:
- Design flaws result in issues such as structural instability, safety hazards, or code violations.
- Infringement upon the intellectual property rights of another party, such as copying a design without permission.
- Missed deadlines, resulting in negative financial consequences for clients.
- Failure to act in the best interests of the client, such as recommending products or materials for the project in order to benefit financially.
Switching your professional indemnity insurance
Every now and again, you may wish to consider a better deal. If you decide to switch your architect insurance to a new insurer, remember that you can no longer make claims against the previous policy. Ensure your past work is covered with the new insurers under what is called “retroactive cover”.
Should I keep professional indemnity insurance if I take a break or retire from being an architect?
It’s wise to keep your professional indemnity if you’re taking a break or retiring from architecture. Claims against professional misconduct or errors can surface months or years after you delivered the work,
Remember: If you have cancelled your policy, your insurance will no longer work.
How long you keep your cover in place is up to you. Consider the type of work you did and the likelihood that a client might bring a claim against you.
Public liability insurance for architects
Public liability insurance addresses legal claims related to accidental injuries or property damage. In the context of an architect’s activities, the risk is typically low unless the architect’s work is also manual.
Do architects need public liability insurance?
Architects often need public liability because they have a lot of contact with clients, their properties, building sites and more. Public liability insurance for architects safeguards your business from unforeseen incidents that can cause injury or property damage.
What does public liability insurance cover?
It's prudent to include this insurance if you engage in regular face-to-face interactions with clients and third parties during your daily activities.
Cover includes:
- accidental injury or death
- accidental property damage
For example:
Someone may claim compensation because:
- You failed to warn a client or a third party of a risk on a building site or on your premises, and they sustained an injury
- During a site visit, you did not secure the entrance after entering or leaving, which led to a theft or an injury to a member of the public.
- While inspecting a client’s house, damage occurred to the interior, and you are asked to pay for repair or replacement.
Other insurance architects buy
The insurance needs of an architects vary depending on your circumstances. Can you handle a legal dispute financially? Is expensive computer equipment integral to your income? What would happen to your business if you became ill and couldn't cover operating costs?
Commercial legal expenses insurance
Most commercial legal expenses insurance will protect architects against various tax and legal issues you may encounter due to your profession, which are not covered by professional indemnity or public liability.
At Suited, we combined £100,000 of commercial legal expenses insurance with helplines and other tools to better assist architects in dealing with these issues. We call this Business Legal Protect, and it’s part of your subscription.
Business Legal Protect provides qualified advice and assistance with:
- Legal and tax matters concerning your business
- Criminal prosecution
- Compliance & regulation issues
- Unpaid invoices (over £200)
For example:
- HMRC investigates your tax affairs
- You are facing an investigation from a professional body
- You need legal help chasing a significant unpaid invoice
- You’re being taken to court for breach of contract
Electronic business equipment insurance
Modern equipment used to create architectural designs is a lot more advanced and can be very costly. The tech transformation within the industry means many architects have increased their investment in electronic business equipment.
If you are one of them, you may like to protect it by having electronic business equipment insurance that would pay for the cost of damage or replacement.
Income protection insurance
Income protection insurance covers your earnings if you become so ill you cannot continue to work.
Architects Suited insures
Suited offers insurance that caters to the needs of a range of architect professionals, including:
- Architects who work on low-rise projects (up to 3 storeys commercial or residential projects)
- Architectural technicians and technologists
- Landscape architects
- Architects undertaking feasibility studies
For all the above professions, Suited offers up to £2,000,000 of professional indemnity and public liability cover.
