Engineering Liability for Contractor 1

[JStephen]

I am a PE that works for a specialty contractor. Typically, we deal with consultants that do rough design, we do final design & shop drawings, and are usually required to seal the shop drawings. We very seldom do any design work that is not on projects we build.

Question is: Should we have liability insurance covering the design aspect of our work? We maintain typical liability insurance for contractors. But as best I can tell, it doesn't cover any type of engineering liability.

Your thoughts would be appreciated!

 

[JAE]

I would think that you would need insurance that specifically covers engineering design. Check with your current insurance carrier to see what is covered and what is not.

Also, I just came back from a short seminar on liability, specifically Design-Build conditions where the engineer is a sub to the contractor. The interesting thing that they stated was that in traditional engineering consultation, the engineer is held to a standard of care based on what other reasonable engineers in the region would have done in the same situation.

Under Design-Build, the engineer has, in many cases, been held to a higher standard...that of the contractor where (s)he is held to a standard based on a full warranty for all the "work" - where "work" includes the design effort. Thus, your design has to be perfect or your "warranty" has failed.

Your situation is similar to that of Design-Build in that you work for a specialty contractor. Thus, standard of care is not applied, but rather a certified warranty of the design work.

 

[weh3]

It sounds almost like product liability to me.

William

 

[PEinc]

JStephen,

You need to talk to your insurace carrier. I worked for a design-build specialty contractor also. Our general liability policy excluded design coverage in the main portion of the policy but there was an ammendment that excluded the exclusion. Therefore, we were covered and our insurance company did not care whether a problem was caused by design or by construction. We were covered either way. Normally contractors don't have professional liability insurance. Your firm sounds like it should have professional liability insurance. Your insurace carrier may not offer it. If not, look elsewhere.