With this option, legal defense costs and other claim expenses have a separate limit; they will not deplete the primary limits, allowing them to be saved to pay for ultimate judgments or settlements.

Understanding About Defense Costs Outside The Limits

Your architectural and engineering firm will benefit greatly from the advantages and security afforded by carrying a professional liability policy. This form of insurance, also known as Errors & Omissions insurance enables practicing professionals to operate under security knowing that in the event of negligence that causes loss to a client there is financial protection. Defense costs outside the limits however, is one aspect of this coverage that should be clearly understood when choosing a policy.

General liability insurance offers no real protection to architectural professionals in terms of the services and products that they provide. This insurance covers accidents that occur in the office and things of the like. If a potential client sustains an injury at your office general liability insurance will cover this. However, if design flaws or oversights cause a substantial loss to an existing client it will be the professional or Errors & Omissions insurance that will offer coverage for these issues.

While there are generally no laws requiring that practicing professionals carry this coverage it is a sound and solid investment for the business. Having it also serves to make your company more attractive to prudent, potential clients. It is a great way to grow and expand your business, building a solid reputation for your company along the way.

While many forms of Errors & Omissions coverage do not offer defense costs outside the limits, this is a key aspect of coverage to search for. Policies with the terms, Defense costs within limits, mean that you will have to pay out of your own pocket for the defense costs that are within the limits of your policy. This is often a huge expense that can create thousands of dollars in defense payments that the company must swallow on its own.

Having a reputable broker help you choose the coverage that is best for your firm will help you garner a policy that fits your needs, both long term and short term. When you upgrade your business to include coverage for your professional services it is important that it include terms and features that protect you in every sense in the event that a claim should be filed. Choosing a policy that has defense costs outside the limits as a key portion of its terms will save you time, money and frustration in the long run.