Built to Last
A Business Insurance Guide for Architects, Engineers, and Design Professionals

Chapter 2: Building Your Business Protection Blueprint
Part 2: Industry-Specific Insurance Needs for Architects, Engineers, and Design Professionals
Umbrella Insurance: More Coverage, Less Hassle

We've already discussed how clients may contractually require architects, engineers, and design professionals to carry certain types of liability insurance. So what happens if a client wants you to carry more insurance than you already have?

This isn't unheard of, particularly when you are a solo practitioner who works on a variety of projects. Perhaps you are collaborating on a particularly expensive project and the client requires you to carry $1.5 million in General Liability coverage when your existing policy has a limit of $1 million.

The most cost-effective way to secure additional coverage for a GL policy is to purchase an Excess Liability / Umbrella Insurance policy. This policy allows you to make a claim for more coverage when certain underlying policies' limits have been reached.

There are two great things about Umbrella Insurance. It offers…

  1. A lot of coverage for little investment. Most Umbrella Insurance policies are sold in increments of $1 million dollars. Typically, this extra coverage won't cost you more than a few hundred dollars each year.
  2. Protection across multiple policies for one annual premium. Though you pay a single annual rate for Umbrella Insurance, you can apply the coverage to both your General Liability and Hired and Non-Owned Auto Insurance policies.

While Umbrella Insurance can offer a lot of protection, it can't be applied to your Professional Liability / Errors & Omissions policy. If you need higher limits for your E & O plan, be sure to talk to your insurance agent.

An Umbrella policy allows you to draw on millions more in coverage when certain underlying policies' limits have been reached.

NEXT: Hired and Non-Owned Auto Insurance: Protection for Architects, Engineers, and Designers on the Move

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