How much does architect insurance cost?
The cost of architect business insurance depends on several factors, such as the types of policies you choose, your location, and your business risks. Save money on small business insurance by comparing quotes from different providers with Insureon.
Average architect insurance costs for top policies
Here are the top insurance policies purchased by architects and their average monthly costs:
- Professional liability (E&O) insurance: $150 per month
- General liability insurance: $34 per month
- Business owner's policy: $72 per month
- Workers' compensation insurance: $50 per month
- Commercial auto insurance: $230 per month
- Cyber insurance: $81 per month
Our figures are sourced from the median cost of policies for architects who apply for quotes with Insureon. The median offers a better estimate of what your business is likely to pay because it excludes outlier high and low premiums.
Professional liability (E&O) insurance
Professional liability insurance for architects costs an average of $150 per month, or $1,800 annually.
This policy, also called errors and omissions insurance (E&O insurance) or professional indemnity insurance, covers the cost of client lawsuits over claims that your work was unsatisfactory, negligent, late, or never completed.
For instance, suppose you make a design error in a blueprint or a project delay costs a client money. A professional liability insurance policy would cover your legal defense costs, settlement, and other financial losses.
Below is the average professional liability policy for architects who buy from Insureon:
Insurance premium: $150 per month
Policy limits: $1 million per occurrence; $1 million aggregate
Deductible: $1,500
Several factors influence the cost of professional liability insurance, including the type of business you have, your claims history, and the policy limits you choose.
As with other types of insurance, you can save money on professional liability coverage by choosing lower limits or a higher deductible.
Reducing your risks also helps you avoid claims and keep your premium low. This includes clear communication with clients and thorough documentation of all communications and agreements.
General liability insurance
Architects pay an average of $34 per month, or $404 annually, for general liability insurance. This policy is sometimes called public liability insurance.
General liability insurance covers common third-party risks at architecture businesses, such as a client who slips on a wet floor at your office and suffers a bodily injury, or accidental damage to a client's property.
For example, if you drop and break a client's smartphone while they're showing you a blueprint they would like you to replicate, general liability insurance coverage would pay for the repair costs or legal fees if the client sues over property damage.
It also helps pay for attorney's fees and other legal expenses if someone sues your business over copyright infringement or other advertising or personal injuries, including defamation.
Below is the average general liability policy for architects who buy from Insureon:
Insurance premium: $34 per month
Policy limits: $1 million per occurrence; $2 million aggregate
The per-occurrence limit is the maximum your insurer will pay for a single covered incident, while the aggregate limit is the most the insurer will pay for all claims during the policy period, typically one year.
General liability insurance costs depend on factors such as the coverage limits and deductible you choose, the types of professional services you offer, your business income, and any additional insured endorsements you select.
Learn more about how your insurance premium is calculated and how to save money on your general liability coverage.
Business owner’s policy
Architecture businesses pay an average of $72 per month, or $859 annually, for a business owner’s policy.
A business owner's policy, or BOP, bundles general liability coverage with commercial property insurance to cover both third-party risks and your business property. It typically costs less than purchasing each policy separately.
A BOP protects against customer injuries, property damage, and vandalism, along with damage to your architectural equipment. Because of its increased coverage and affordability, it’s the policy most often recommended by Insureon’s agents.
This is the average BOP for architects who buy from Insureon:
Insurance premium: $72 per month
Policy limits: $1 million per occurrence; $2 million aggregate
Deductible: $500
Small, low-risk architecture companies are often eligible for a business owner's policy.
Architectural business owners may see higher costs if they choose to add endorsements to their policy. Insurance endorsements, such as business interruption insurance or equipment breakdown coverage, are often recommended to help avoid financial losses if a fire or power outage forces your business operations to cease for an extended period of time.
The cost of a business owner's policy is based on many factors, including the value of your business property, where you are located, the types of projects you take on, the number of employees you have, and your specialty.
Workers’ compensation insurance
For architects, the average cost of workers’ compensation insurance is $50 per month, or $598 annually.
This policy covers medical expenses and lost wages related to employee injuries. It usually includes employer's liability insurance to protect against lawsuits from injured workers.
Businesses with employees typically must purchase workers' comp to comply with state requirements and avoid penalties. For example, all architecture businesses in California, Pennsylvania, and New York must carry workers' comp if they have one or more employees. Florida businesses need coverage when they have four or more employees, and coverage is optional in Texas.
Since health insurance plans can deny claims for injuries related to your job, workers' comp coverage is also recommended for independent contractors as a financial safety net and for peace of mind.
The cost of workers' comp depends on several factors, primarily the number of employees you have and their occupational risks. You can save money on workers' comp coverage by classifying your employees correctly and implementing a risk management plan to avoid work-related injuries and subsequent claims.
Commercial auto insurance
Building design businesses, including architects, pay an average of $230 per month, or $2,755 annually, for commercial auto insurance.
This type of insurance pays for legal costs and medical bills if your company vehicle injures someone or damages their property in an accident. It can also cover vehicle theft, vandalism, and weather damage.
Most states require commercial auto insurance for vehicles owned by an architecture business. For personal, rented, and leased vehicles used for work purposes, look to hired and non-owned auto insurance (HNOA) instead.
The cost of commercial auto insurance depends on several factors, including your policy limits, additional coverage options you choose (e.g., additional insured endorsements), the number and value of your vehicles, and the driving records of anyone permitted to drive.
Cyber insurance
Building design professionals, such as architects, spend an average of $81 per month, or $975 annually, on cyber insurance. This policy is also called cyber liability insurance or cybersecurity insurance.
Cyber insurance helps your architecture business recover financially after a cyberattack or data breach. It can cover data breach investigations, cyber extortion payments, and costs related to complying with your state's data breach laws.
A cyber liability insurance policy is especially crucial for architecture businesses that store sensitive client information, such as credit card numbers, Social Security numbers, and email addresses.
The cost of cyber insurance and the coverage you need depend on the amount of sensitive information you handle at your architectural firm.
How are architect insurance costs calculated?
Architect business insurance coverage costs are determined by several factors. While underwriting your policy, insurance companies will consider the following when calculating insurance rates:
- Types of architectural services offered: Architecture companies may see elevated premiums if they offer higher risk services, such as structural work or site inspections, compared to architectural businesses that only provide interior design or drafting work.
- Business property and equipment: Architects that operate with higher-value tools or equipment are likely to see more expensive premiums. Also, any items that are frequently used could cost more to insure than items which are used less often.
- Annual revenue: The more your architecture firm makes in a year and the more you pay your employees or subcontractors, the higher your premium will cost. That’s because increased revenue and payroll often indicate larger projects, more clients, and greater exposure to possible claims.
- Location: If your architecture business operates in an area that is more prone to natural disasters, increased foot traffic, or high crime rates, you may have to pay higher insurance costs than an architect located in an area where these factors are less present. Also, your state's litigation trends and local regulations can affect costs.
- Years of experience: Architecture firms and professionals with an established track record may be eligible for lower insurance rates than newer businesses with limited operating history.
- Type of projects: Insurance companies take into account the types of projects you take on, including their complexity and size. An architecture business that works on high-risk, larger, or more specialized projects, such as institutional buildings, may see increased premiums compared to one that only takes on smaller and less riskier projects, like small residential places.
- Claims history: An architecture firm with a lengthy list of previous insurance claims will likely pay more for insurance than one with no claims history.
- Types of coverage: For professional liability coverage, the type of policy you choose can influence your premium. Most professional liability policies for architects are written on a claims-made basis, which generally start with lower premiums that then increase during the first few years of continuous coverage. While occcurrence-based policies are less common for professional liability insurance, they may be available for other types of business insurance.
- Firm size: The more employees and subcontractors your architecture business has, the greater the potential for mistakes or errors, property damage, and liability claims.
- Coverage limits and deductibles: Architecture companies with higher coverage limits and lower deductibles on their insurance policies will typically increase their premium costs, while lower limits and a higher deductible can help keep their rates lower.
How do I get architect insurance?
Insureon can help architects, engineers, interior designers, and other building design professionals find affordable insurance coverage in three easy steps:
- Fill out a free online application with details about your business.
- Compare custom quotes from top-rated U.S. insurance companies.
- Select a policy and pay the premium to begin coverage.
You can consult a licensed insurance agent for questions about your risks, state insurance requirements, and the best types of coverage for your business needs.
Once you've bought a policy that best meets your insurance needs, you can download a certificate of insurance (COI) for proof of coverage. Most small business owners can get coverage with the right insurance solutions within 24 hours of applying for quotes.
What our customers are saying
The average costs on this page were derived from our data on small business owners in the architecture field who purchased policies through Insureon. Most of our customers have less than five employees, annual revenue ranging from around $50,000 to more than $200,000, and five years or less in business.
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