In the state where I am, a construction contractor (residential general contractor tier) is required to carry a minimum of a $500,000 per occurance general liability insurance and $20,000 surety bond. An RGC tier contractor would be responsible for every trade employed to construct the project. You are a licensed architect so you're making design decisions relating to every single trade of construction that is involved to build the project. You're Professional Liability / E&O insurance should at least be comparable to a residential general contractor's insurance....... IF you were doing this full-time. Since you're not, you might have some pro-rating but then again, the volume of work you may have may effect your insurance rate. In my opinion, $250,000 E&O / professional liability insurance at the very least if you carry any. Consider the value of the cost of construction for such a project and what happens if a complete catastrophic disaster occured resulting from your errors or omissions and the structure needs to be re-built.
This is something that you may need to consult with your insurance carrier for professional liability insurance for any other project you typically work on. You might have what you need at the firm you are at... but you might be on your own. There are insurance packages that are targeted for small solo architect and small firm practices. What I have seen, they are usually offering at $500,000 to $2 Million coverage. Some down to $250,000 but that's the low end from what I have seen. It doesn't mean there are not lower coverage packages. I just would expect the figure to be around $500,000 to $1 Million being common for an individual architect and building designers.
As a building designer, where I am, I work on similar type projects to what you mentioned about regarding residential additions. If I am going to carry E&O/professional liability insurance, $500K coverage is likely to be the minimum but I wouldn't go with anything less than $250K coverage.
I have only ever been sued / had legal action taken against me on small residential projects, which is only about a 10% of our business. ( Not responsible but still got dragged into court ). Home owners and their insurance companies are happy to settle insurance claims with the home owner then turn around a sue everyone involved in the project to try and reclaim their money..... truth!
I can’t advise whether you need insurance or not, but I suggest contacting some insurance firms to see what it might cost. When I was in private practice doing residential work I got architect liability insurance through State Farm, who held my homeowners insurance. It was a specialty arm of State Farm at that point. It only cost about 2000 a year, so it was worth it to me in terms of peace of mind.
Feb 7, 22 8:42 am ·
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Insurance for small residential work.
I am a licensed architect working at a small firm. I do some small residential addition work on the side and provide stamped documents.
What level, if any insurance is advisable or required for these freelance projects? My review of similar posts leave me uncertain.
Thank you.
what do you think your liability is for the amount & type of work done?
SBKD,
In the state where I am, a construction contractor (residential general contractor tier) is required to carry a minimum of a $500,000 per occurance general liability insurance and $20,000 surety bond. An RGC tier contractor would be responsible for every trade employed to construct the project. You are a licensed architect so you're making design decisions relating to every single trade of construction that is involved to build the project. You're Professional Liability / E&O insurance should at least be comparable to a residential general contractor's insurance....... IF you were doing this full-time. Since you're not, you might have some pro-rating but then again, the volume of work you may have may effect your insurance rate. In my opinion, $250,000 E&O / professional liability insurance at the very least if you carry any. Consider the value of the cost of construction for such a project and what happens if a complete catastrophic disaster occured resulting from your errors or omissions and the structure needs to be re-built.
This is something that you may need to consult with your insurance carrier for professional liability insurance for any other project you typically work on. You might have what you need at the firm you are at... but you might be on your own. There are insurance packages that are targeted for small solo architect and small firm practices. What I have seen, they are usually offering at $500,000 to $2 Million coverage. Some down to $250,000 but that's the low end from what I have seen. It doesn't mean there are not lower coverage packages. I just would expect the figure to be around $500,000 to $1 Million being common for an individual architect and building designers.
As a building designer, where I am, I work on similar type projects to what you mentioned about regarding residential additions. If I am going to carry E&O/professional liability insurance, $500K coverage is likely to be the minimum but I wouldn't go with anything less than $250K coverage.
I have only ever been sued / had legal action taken against me on small residential projects, which is only about a 10% of our business. ( Not responsible but still got dragged into court ). Home owners and their insurance companies are happy to settle insurance claims with the home owner then turn around a sue everyone involved in the project to try and reclaim their money..... truth!
I can’t advise whether you need insurance or not, but I suggest contacting some insurance firms to see what it might cost. When I was in private practice doing residential work I got architect liability insurance through State Farm, who held my homeowners insurance. It was a specialty arm of State Farm at that point. It only cost about 2000 a year, so it was worth it to me in terms of peace of mind.
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