Architects And Engineers Insurance
Architects and Engineers (A&E) Liability Coverage
What Is Architects and Engineers (A&E) Liability Coverage?
As its name suggests, architects and engineers (A&E) liability coverage is a type of insurance policy designed to protect architects and engineers. Specifically, it provides coverage for potential damages relating to construction delays, structural damages, and other potentially costly risks.
Although A&E liability coverage is designed with the needs of architects and engineers in mind, similar policies are available for other professions, such as doctors and lawyers. Businesses can also obtain general commercial liability insurance to cover a range of potential claims.
How A&E Liability Coverage Works
Designing a building is a complex undertaking. Mistakes in calculations could result in construction delays, or, in the worst case, could even cause a building to collapse. Depending on the nature of the error, the architects and engineers who designed the building could be held partially or fully responsible for these damages, resulting in a costly financial penalty. To protect against this, many architects and engineers purchase A&E insurance.
Although its name refers only to architects and engineers, A&E liability coverage can actually be purchased by a wide range of building professionals, such as electrical or structural engineers, construction managers, and surveyors. Typically, the policies are renewed each year and are purchased by the firm rather than by specific professionals. In some cases, these policies will also provide coverage for subcontractors.
Although A&E liability coverage can go a long way toward controlling the risks of the building profession, there can be notable gaps in the coverage they provide. Common examples include damages relating to overseas projects, breach of contract, or emerging risks such as cyber liability. Another potential issue is that, while most A&E policies provide global coverage, this coverage usually only applies to the definition of liability that is common to U.S. courts. Finding policies that provide coverage for contractual liability in the event that another country’s laws do not follow the same guidelines as the U.S. can help close this gap.
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