E & O Liability Insurance?
E & O Liability Insurance?
(OP)
Liability insurance seems to be a necessary evil in this day and age. When premiums are due you feel you are paying too much, when a lawyer calls you don’t have enough coverage! I am wondering how other engineers are handling the problems associated with qualifying for insurance, selecting an amount of coverage and selecting a deductible amount. Is there a plan that offers basic coverage and can be increased on a per job basis? Can you get coverage on a per job basis? If you are a one man firm, what do you do? Have you had any luck with clients actually SIGNING a limit of liability clause in your contract for services?
RE: E & O Liability Insurance?
When a lawyer calls do I have enough coverage? Who knows. I asked once how to determine what would be an appropriate amount of coverage, given the nature of my work. The insurance company told me to carry the minimum, that way I would not become a major target in a lawsuit. When lawyers gather to discuss commencing an action, the FIRST item on the agenda is "Who has the deepest pockets?"
What deductible amount should you select? It's your choice, and your decision.
Can you get coverage on a per job basis? Yes, but you'd better check with your particular insurance company.
If you are a one man firm what do you do? I am a one man firm and I pay, pay, pay. You must build it into your overhead. That's one reason why engineers must charge $100 per hour. (My rate is less than this.) Another note concerning one-man operations: I cannot prove this, but I believe the insurance companies frown upon such operations. The first reason: who is checking your work? The second reason: Many expensive lawsuits are the result of one-man or small operations. (Expensive in relation to the premium which they can extract from such firms.) So the insurance companies do not want to encourage any engineer to hang out his shingle.
Have I had any luck with clients signing a limit-of-liability clause. Nope. I've never heard of such a thing. In some places, you can operate without insurance as long as you tell your client (in writing) that you have no insurance. Then he has to say (in writing) I understand you have no insurance and I authorize you to proceed. It is my personal opinion this avenue is for numbskulls.
RE: E & O Liability Insurance?
The AEC Design Liability Program is an open brokerage program available through our partner, Managing General Underwriter/Administrator:
Victor O. Schinnerer & Company, Inc.
2 Wisconsin Circle
Chevy Chase, Maryland 20815
301-961-9800
301-951-5444 (fax)
http://www.schinnerer.com or for more AEC information http://www.planetaec.com
RE: E & O Liability Insurance?
Every proposal I send out has a Limit of Liability Clause in it. Out of almost 500 projects, only a handful of clients have either not accepted my
RE: E & O Liability Insurance?
RE: E & O Liability Insurance?
I am struggling with these same questions right now. I ran across a comparison of different insurance companies on the NSPE site. Here is a link.
http://www.nspe.org/liability/SurveyResults2002.pdf
RE: E & O Liability Insurance?
RE: E & O Liability Insurance?
Shop around. My broker handled insurance from more than one firm.