Business Insurance for Engineers

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The role of an engineer involves a great degree of precision and dedication to get the job done. Within the engineering field there are many specialty areas, all which come with their own expertise and level of risk.

Taking the time to understand how business insurance can protect you and your engineering business sets a solid foundation for safeguarding your future. There are different types of insurance available such as general liability insurance and professional liability insurance for engineers but you need to know which one is appropriate for your engineering business..

Why Do Engineers Need Insurance?

Clients seek out your expert skills and expertise to help design and create their projects. With so much at stake, a simple mistake, actual or alleged by an unhappy client could have a devastating impact on your finances and reputation.

Insurance is an investment that is designed to protect you and your business from the different risks it may face in the engineering industry. If the worst were to happen, you can have peace of mind knowing that you have the right cover in place.

These are some of the things you need to consider when purchasing an engineering insurance for your business. We will discuss this in further detail below, so you can have a better understanding of the types of business insurance you need as an engineer.

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What is the best business insurance for engineers?

With many different types of insurance available, we’ve narrowed down some of important types of cover you need to consider as an engineer.

Professional Liability insurance

Your clients hire you to bring their grand plans to life, a process that can involve anything from residential structures to major roadways. The unfortunate reality is that if a client deems you have been negligent in your role, a claim against your engineering business can take up a lot of time and money.

Often referred to as E&O insurance, Professional Liability insurance protects your business against claims of negligence, misrepresentation or mistake. A client may make an allegation that your engineering expert services, products or employees caused some kind of financial damage to a third party. Whether you are at fault or not, the time and cost involved with litigation can take a toll on your business and have an impact on your business’ reputation.

The purpose of Professional Liability insurance is to protect you from devastating financial damages which may result from alleged negligence or an error in the delivery of your services.

Coverage is provided for:

Attorney fees and other legal expenses

Costs and expenses related to a settlement

Costs and expenses related to a judgment

You may need to also consider extending the life of your policy beyond the completion date of your engineering projects, as a lot of claims can occur long after construction has been completed.

General liability insurance

A main type of insurance taken out by engineers, General Liability insurance can protect your business against bodily injury or property damage lawsuits from outside parties.

Regardless if an accident is your fault or not, if the accusation is true or false, you can experience peace of mind knowing that you are protected with General Liability insurance. The coverage may help protect you architect or engineering business against claims covered by paying the defence costs and any damages up to the selected limit of your policy.

Business Owners Policy

The Business Owner’ Policy (BOP) is a packaged insurance solution designed to protect your architect or engineering business against the typical risks it may be faced with each day. The BOP product can be tailored from a selection of various different types of coverages to suit the specific requirements of your architect or engineering business.

The types of insurances included with the BOP product can be different but usually include the standard types of insurance coverages to protect against things like property damage, business interruption and liability.

Workers compensation insurance

Workers Compensation is there to help protect your employees.

It is sometimes referred to as workman’s comp or workers comp, this type of coverage provides protection for your employees if they were to suffer a work-related illness or injury.

Some of the benefits your employees will receive under a Workers Compensation policy include:

Medical care
Replacement of lost wages when taking time off to recover
Funeral costs paid for if they were to pass away
Disability support costs

How can you save money on business insurance?

These are a few simple ways you can save money on your business insurance:

Shop around – compare your policy with other providers for the best deal
Only insure what you need – there are many types of coverages available on the market, but not all of them will be suited for your business. Understand what the most appropriate forms of cover for your business are and only purchase the coverages that you need.
Select a higher deductible – the higher your deductible the lower your premium, the amount which you pay before you lodge a claim. Just make sure you will be able to afford the deductible cost before opting for a higher one.
Chat to an insurance specialist – talking to someone about your unique engineer insurance needs will help when making decisions about the type of cover, limits etc.

How much insurance cover does an engineer need?

Every engineering business will have its own needs and exposure to risk, meaning there’s no one size fits all insurance policy.

There are a few factors that need to be considered and these include:

The nature of your engineering work and types of risks you will be dealing with
If there are certain regulations in place specific to your geographical location
The value and size of the project you are working on
The size of your business, turnover, number of employees etc.

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