4 Key Types Of Insurance You Need To Protect Your Architecture Business

Almost every business plan should mention insurance. But in the architecture industry, it’s more important than most. There are many reasons for taking out business insurance. For architecture businesses, risks include various types of accidents and liabilities.

Some of the most common types include:

• Trade credit insurance

• Professional indemnity/Public liability insurance

• Employers’ liability insurance

• Vehicle insurance

Trade Credit Insurance

Trade credit insurance (sometimes referred to as bad debt insurance) covers architecture businesses in the unfortunate event that customers fail to pay on time or, worse, fail to pay at all. In addition to reducing saving time, the biggest benefit credit insurance can offer to business owners is the peace of mind it brings when negotiating deals or working with new suppliers.

As an architect, you’ll likely be working with a range of suppliers meaning trade credit insurance is one of the first types of insurance you should be looking at.

Professional Indemnity/Public Liability Insurance

As an architecture business, you’ll be liable for designing safely and on time. As such, it’s important to be protected in the event of a liability lawsuit.

Professional indemnity insurance covers against claims made by clients who feel a mistake has been caused by your negligence. Whether you’re working on a residential house extension or a New York City skyscraper, you’ll need to be protected in case of any mistakes you make. Holding professional indemnity insurance also acts as another reason for clients to trust and work with your business.

Public liability insurance is similar but covers claims made by members of the public as opposed to clients.

Employers’ liability insurance

In the UK, all employers must have employers’ liability insurance. Given the nature of the industry, this will apply to most architecture businesses.

Employers’ liability insurance can cover employers against claims for illness or injury at work caused by the employer’s negligence. Given the nature of the industry, it’s likely that employees will be working with or around heavy machinery.

Reasons for claims may include a lack of health and safety training, being exposed to toxic chemicals or accidents caused by faulty or poorly maintained machinery.

Vehicle Insurance

Commercial vehicle insurance can be taken out by anyone who uses a vehicle as part of their job. Large architecture businesses may own heavy plant vehicles which come with obvious dangers to operators. For smaller companies, this also applies to firms that are utilising company vehicles.

However, even architects operating as sole traders will need to travel to and from sites and may use their personal cars or vans. In this case, you’ll be eligible to take out business vehicle insurance as your personal vehicle is being used for work purposes.

Vehicle insurance is commonly purchased as a package that best suits the borrower and usually covers against things like:

• Passenger protection

• Equipment/tools theft

• Breakdown and recovery

• An accident that wasn’t your fault

Note that, whilst these are some of the most common types of insurance available to architecture businesses, there is a seemingly endless list of available insurance types available to businesses.