Engineering Inc. - November/December 2004 - 22

By Thomas H. Porterfield Balancing Reward&Risk Do you have enough insurance
for the big project? Professional liability insurance is an important
component of an engineering firm's compre- hensive risk management
program. Typically, a firm's primary policy provides sufficient pro-
tection for its liability exposures. However, l y i n g carrier's
financials, claim-handling expertise and commitment to this line of when a
firm has the opportunity to participate insurance. Where excess insurance
is concerned, your in the design and construction of a big proj- broker
can explain your options with the ect, additional insurance may be
necessary. same due diligence as he or she does with your primary
insurance, and recommend an excess carrier. First Steps added level of
comfort for which the firm What About an Umbrella? The first step a firm
should take is to consult and client are looking. with a knowledgeable
insurance agent or Umbrella insurance policies, like excess poli-
Purchasing Excess Insurance broker who has an in-depth understanding cies,
provide additional coverage over pri- Coverage of the complexities of both
the A/E profes- mary coverage. But while an excess policy si o n al
liability insurance market and the A firm also can purchase an excess
insurance sits over a single primary policy, an umbrella construction
industry. Not sure what to look policy to satisfy its needs. Excess
policies covers multiple policies. In addition, many for? ACEC's new Guide
To Professional Lia- provide additional protection that kicks in if
umbrella policies specifically exclude cover- bility Insurance includes a
chapter on the your firm exhausts the limits of its primary a g e for
professional liability exposures. qualifications that are important in an
agent policy. In order to qualify for excess cover- Before purchasing an
umbrella policy, make o r broker. Once a firm has secured an age, the
carrier will require your firm to sure that it covers the risks that need
to be expert, it has several coverage options. c a r r y a certain minimum
limit and insured. deductible on the primary policy. Increasing Your Limit
Owner - or Contractor-Controlled The availability and cost of an excess
pol- Insurance Programs A firm may be able to cover its additional icy is
dependent on a number of factors. exposure by increasing the limit of
liability These include: the general state of the insur- These programs
only come into play on on its existing primary policy. For example, ance
industry, project type, your firm's level mega-projects and are written to
cover the the CNA/Schinnerer program provides lim- of experience and
expertise, client type, the e n t i re design team's professional
liability its of up to $25 million for qualified firms. excess carrier's
comfort level with the under- exposures. One of the major benefits to a
Although the increased limit is not dedi- lying professional liability
form, and the client or contractor is a significant premium cated to a
specific project, it can provide the excess carrier's comfort level with
the under- savings by covering the major project expo- 2 2 E N G I N E E R
I N G INC. N o v e m b e r l December 2004
Engineering Inc. - November/December 2004

Table of Contents for the Digital Edition of Engineering Inc. - November/December 2004
