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Ask the Expert Q&A: Architects & Engineers Insurance, Canada

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Featured Solutions: Architects and Engineers

Labor shortages, supply chain issues and cybersecurity concerns are among the challenges currently facing Canada’s architects and engineers. To learn more about how Architects & Engineers Insurance can help, we spoke with Paula Lansky, Manager, Professional Liability, Burns & Wilcox, Toronto, Ontario.

What are some of the greatest risks facing architects and engineers in Canada today?

P.L. The risks that these types of companies are facing do not differ very much from what other companies in Canada are facing right now. That would include things like managing their reputation, including looking after the health and safety of their employees; the labor shortage; the cost of materials; supply chain issues, which is a worldwide issue; and focusing on their balance sheet and their cash flow to make sure they are able to pay their receivables on time and negotiate financing arrangements. With changing technology, cybersecurity is also a big risk. Construction was never fully shut down in Canada because it was considered an essential service, but with many architects and engineers designing from home, that brings an entirely new and broader exposure from a cyber perspective. Just because they are architects and engineers does not mean that they are immune to these risks.

What insurance policies can help architects and engineers respond to these threats?

P.L. They need to have their Architects & Engineers Professional Liability Insurance, also known as Errors & Omissions (E&O) Insurance, in place. This is designed to cover allegations of negligence in the performance of their professional services. They also need to have Commercial General Liability (CGL) Insurance, which can cover third-party bodily injury and property damage, and they need Commercial Property Insurance, Crime Insurance and Cyber & Privacy Liability Insurance.

How has COVID-19 affected the Architects & Engineers Insurance market?

P.L. Every insurance product has been affected by COVID-19. As a result of COVID-19, overall capacity in the market has decreased, and the demand for Architects & Engineers Professional Liability Insurance has increased. That is obviously resulting in higher rates; we are seeing increases even beyond what they had been prior to COVID.

What steps should architects and engineers take to complement insurance coverage from a prevention standpoint?

P.L. Having good risk management practices in place is essential. They should carefully review the contracts that they sign and ensure the wording protects them. They can mitigate some exposure through the contract language they use. Continuing education is also important, and focusing on the health and safety of employees, whether they are working in the office, at home or on a construction site. That is paramount and absolutely has to be enforced. Security measures around cybersecurity also have to be enforced. This can be an increased cost to the company but, in the long run, will result in a better risk to insure and less money leaving the company’s balance sheet.

What are the greatest opportunities for brokers to get into Architects & Engineers Insurance?

P.L. The biggest opportunity for brokers is to become experts in this field. By devoting significant time focusing on understanding the unique businesses and exposures of not only architects and engineers, but also other professions within the design or construction-related industry, they will stand out because they will understand these businesses and how best to tailor insurance coverages to protect them. That understanding, coupled with strong relationships with markets that specialize in this field, are paramount to their success.

What advice would you give brokers to increase their success rates with these products?

P.L. Along with the points made regarding opportunities for brokers, networking at the provincial associations and getting involved in these associations can be helpful in landing new opportunities and securing deals for clients.

What features of Architects & Engineers Insurance are specific to Burns & Wilcox?

P.L. Our expertise is a great advantage. I have been a specialist for architects and engineers for 25-plus years and I am a resource for the company. I understand the changing risks, the exposures, and I can educate brokers and speak with clients in their language. We also have access to a broad number of specialty markets that have been underwriting Architects & Engineers Professional Liability Insurance for decades, and we work closely with them to tailor the insurance to match the exposures for each individual company we are looking at. We want to be here for the long haul, partnering with our insurance carriers and clients.

 

Architects & Engineers Insurance

Why your clients might need it: Architects and engineers face risks similar to those in other industries with the labor shortage and supply chain issues that could impact their projects. Also, with many architects and engineers working from home, they opened themselves up to broader cybersecurity risks.

Protects against: These policies are designed to mitigate allegations of negligence in the performance of their professional work. They also protect against risk from third-party bodily injury and property damage.

Expert opinion: “You have to be able to speak to an architect or an engineer in their language. These are professionals who go through multiple years of education and they are held to a very high standard as professionals; they want to be dealing with someone who understands their business.” Paula Lansky, Manager, Professional Liability, Burns & Wilcox, Toronto, Ontario.

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