Contractor's Professional Liability insurance protects contractors from construction errors that can arise from professional services. Whether builders take on the responsibility for all facets of the design and build themselves, or contract out to third-parties, this complex process exposes everyone involved to the risk of an error or mistake.
Contractor's Professional Liability insurance covers claims resulting from an act, error, or omission during the performance of a professional service such as consulting, construction management, engineering, architectural or interior design. With so many professionals involved in different aspects of projects, contractor's professional liability coverage provides a safety net in the event an error leads to a professional negligence lawsuit.
What Contractor Professional Liability Covers
General liability policies typically exclude all coverage for claims arising out of professional services. Contractors with exposure to design or any other type of related professional services should consider purchasing a professional liability policy to cover this gap in their general liability policy. Whereas it usually takes a claim of bodily injury or property damage to trigger coverage under a general liability policy, in comparison, economic losses due to an error or omission can be a trigger of coverage under a contractor's professional liability policy form. If a design defect prevented a building from being certified for occupancy, or the improper installation of a mechanical system didn't circulate enough heat or cooling to a building, a contractor's professional liability policy might provide coverage for the resulting claim when a general liability policy most likely would not.
Design/Build general contracting firms, "agency" and "at risk" construction managers, architectural and engineering firms, interior designers and subcontractors like mechanical, electrical, and fire sprinkler, who mix in services such as engineering or architectural design with their normal contracting operations, can shore up their defenses against claims of professional negligence by adding professional liability to their coverage portfolio.
At Beach & O’Neill Insurance Associates we have access to multiple markets that specialize in writing professional liability. If you would like information on professional liability, please contact our office and we will help you. We can assist you with making the decision on whether this coverage if right for your business.