Architecture Firm Business Insurance
Getting insurance for your architecture firm is essential.
Architecture firms need to be protected against claims involving things that could possibly happen and damage them financially, such as professional negligence or copyright infringement.
For example, a client may claim that the design you gave them was not what they agreed to pay for, or your firm’s logo may be too visually similar to a copyrighted design.
We’ll help you find the most personalized and affordable coverage for your unique business.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for an Architecture Firm
General liability insurance is — generally speaking — one of the most important insurance policies for architecture firms.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
Having said that, architecture firms tend to make use of various supplementary insurance policies to guarantee optimal protection from potential risks. These include:
- Professional liability insurance
- Commercial property insurance
- Workers’ compensation insurance
Business owners searching for insurance are typically faced with two general types of providers:
- Traditional brick-and-mortar insurers: Includes providers like CNA and Hiscox, who are based (at least partially) out of a physical storefront and use an insurance agent to provide personalized quotes.
- Online insurers: Purely online-based providers who use AI in place of an insurance agent and are not based from a physical storefront. This combination allows them to offer insurance of a similarly high quality quickly and cheaply.
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Cost of General Liability Insurance
On average, architecture firms in America spend between $500 - $1,500 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for an architecture firm to other professional industries using the graph below.
Several factors will determine the price of your policy. These include your:
- Location
- Deductible
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy.
A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
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Common Situations That General Liability Insurance May Cover for an Architecture Firm
Example 1: During a visit to your office, a client slips on a wet floor near your restroom and breaks an arm. Because your employee forgot to display a “wet floor” sign, the client demands your business pay for his medical care. General liability insurance would cover the client’s medical treatment.
Example 2: While you visit a client’s home to discuss a new office building design, you trip over her cat, fall into her large television, and smash your hand through the screen. General liability insurance would cover the cost to repair the client’s damaged property.
Example 3: A competitor claims you stole his logo design and decides to sue your business. While you disagree with the accusation, you need to hire an attorney immediately. Your general liability policy will pay for your legal representation and any awarded settlement.
Other Types of Coverage Architecture Firms Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some of the most common types of coverage:
Professional Liability Insurance
This insurance covers your business in the event a client accuses you of negligence due to a mistake or failure to perform. If a client claims your work caused them harm and sues your company, professional liability insurance would cover your legal fees and any required settlement.
Commercial Property Insurance
You made a major investment in your business equipment and supplies. If you own the building in which you operate, commercial property insurance would cover the cost of repairing or replacing your business-related property in the event of a fire, theft, or natural disaster. This includes structural damage to your building or grounds as well as the equipment and supplies you store there.
Workers’ Compensation Insurance
If you have any employees, most states will require you to carry workers’ compensation insurance for both part-time and full-time workers. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover, but also any disability or death benefits stemming from a work-related accident.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your architecture firm:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Architecture Firm Business Insurance FAQ
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
We would generally advise you to get business insurance for your architecture firm prior to starting it due to the uniqueness of the risks it faces.
In some cases, you may even be obligated by law to hold different policy types to ensure you are operating in compliance with state regulations.
Not necessarily. Certain exceptions may be written directly into your architecture firm insurance policy, and some perils may be entirely uninsurable.
Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.