What You Need to Know About Professional Liability Insurance in the Construction Industry

In construction, there are a variety of insurance policies that contractors and design professionals need to consider. One of the most important is professional liability insurance, which is designed to protect against claims of negligence or errors in professional services. In this article, we'll explore how professional liability insurance differs from other types of insurance in the construction industry and provide examples of professional liability exposures in building design and construction.

Professional Liability Insurance vs. General Liability Insurance

General liability insurance is a common type of insurance, but it differs from professional liability insurance in several ways. General liability insurance is designed to protect against claims of bodily injury or property damage that result from accidents or other unexpected events. For example, if a worker falls off a ladder and is injured on a construction site, general liability insurance would cover the costs of medical treatment and any legal fees associated with the claim.

Professional liability insurance, on the other hand, is designed to protect against claims of negligence or errors in professional services. This type of insurance is particularly important for design professionals, such as architects and engineers, who are responsible for ensuring that buildings are safe and structurally sound. If a design professional makes an error in their work that leads to property damage or bodily injury, professional liability insurance would cover the costs of any legal fees or settlements associated with the claim.

Examples of Professional Liability Exposures in Building Design and Construction

There are many different types of professional liability exposures in building design and construction. Here are a few examples:

1. Design errors: Design professionals are responsible for ensuring that buildings are safe and structurally sound. If a design error leads to property damage or bodily injury, the design professional could be held liable for the costs associated with the claim.
2. Construction defects: Contractors are responsible for ensuring that buildings are constructed according to the plans and specifications provided by the design professional. If a construction defect leads to property damage or bodily injury, the contractor could be held liable for the costs associated with the claim.
3. Delayed completion: Construction projects are often subject to tight deadlines, and delays can be costly for all parties involved. If a contractor or design professional causes a delay in the completion of a project, they could be held liable for any financial losses incurred by the owner or other parties involved in the project.
4. Environmental hazards: Design professionals and contractors are responsible for ensuring that buildings are safe and free from environmental hazards. If a building is found to contain hazardous materials, such as asbestos or lead paint, the design professional or contractor could be held liable for the costs associated with remediation and any legal fees or settlements associated with the claim.
5. Code violations: Design professionals and contractors are responsible for ensuring that buildings meet all applicable building codes and regulations. If a building is found to be in violation of a code or regulation, the design professional or contractor could be held liable for any costs associated with bringing the building up to code and any legal fees or settlements associated with the claim.

If you're a contractor or design professional in the construction industry, it's important to ensure that you have adequate professional liability insurance coverage. Don't wait until it's too late to protect yourself and your business from claims of negligence or errors in professional services. Contact AssuredPartners Construction today to learn more about professional liability insurance and how it can help protect you and your business.