Despite your years of experience or keen eye for detail, risks are an inevitable part of doing business. While the stakes are much higher for architects compared to those outside of the design/build industry, no two businesses are alike in the terms of risk exposures.
To help you make sense of where you might be most vulnerable for risk exposures, the following are the top commercial risks architects will face:
- Property exposure is that of an office. Storage of paper is an important part of the operations. All should be in file cabinets and a no-smoking policy should be in effect.
- Inland marine exposures involve Accounts Receivable, Computers, Valuable Papers and Special Floaters. The valuable papers include drawings that are on the boards. It is important to have duplicates and that all be stored in fireproof cabinets. The computers are extremely sophisticated and specific for each job. All software and data should be on backup disks and stored off site. The job will determine the equipment that is needed off site. Proper packing and security is necessary.
- Crime exposure is from Employee Dishonesty. There must be procedures on ordering and a separation between billing and disbursements.
- Occupiers’ liability on site is limited since customers don’t frequently come on premises. There is more of an off-site exposure that can include job sites and clients’ offices. There should be policies in place that direct acceptable behaviours.
- Professional liability exposure is extensive. The types of jobs accepted determine the potential for loss. Different types of jobs also require varied levels of knowledge and expertise. For example, bridge design will require a different type of knowledge than a one-family dwelling. All employees who design should have appropriate accreditations, and continuing education should be required. Independent verification of education, background, and licences and certifications should be required for all professionals.
- Automobile liability exposure is mainly Hired Non-Owned and rental exposure. If there is owned auto exposure, there should be a stated policy on personal use and permissive uses.
- Workplace safety exposure will vary based on type of job. Much of the job is done in the office and therefore requires ergonomically designed workstations. In addition, there may be the off-site exposures, e.g., bridge work, oil derricks or housing developments. There must be an awareness of past jobs in order to determine the future exposure.
- Minimum recommended coverage includes Business Personal Property, Dishonesty, Disappearance and Destruction, Accounts Receivable, Computers, Valuable Papers, Special Floater, General Liability, Professional, Umbrella, Non-owned Automobile.
Our brokers at the Axis Insurance Group specialize in risk management programs for design professionals. To see how we can help you keep pace with your ever-changing needs, contact us today.
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