What Does Insurance for Interior Designers Cover?
- General Liability
- Business Personal Property (for all locations)
- Business Auto, Workers Compensation, and Umbrella
- Professional Liability and 3rd-party Crime
- Workers Compensation
Most people might not think of interior design as the kind of business where there are many unexpected hazards or costs. However, as is the case in any industry, several different problems can happen while on the job. When those accidents or incidents do occur, it can cost you both time and money to remedy the situation.
By signing your business up for an interior designer insurance policy, you can develop a solid plan to help ensure that neither you nor your company ends up in hot water. You can also feel confident that when things do take a turn for the worst, you’ll be fully protected. By contacting Pen-Ex, we can give you a fast, free quote for the plan that would best suit your business, based on coverage, pricing, or both.
Do Interior Designers Need Errors and Omissions Insurance?
Irrespective of your specialization, running a commercial or residential interior designer business exposes you to several risks. As an interior designer, you are always susceptible to common risks like property damage and on-site injuries that can lead to problematic situations.
Interior Designer Insurance ensures that you can easily overcome such claims while your insurance covers your business from these risks.
What Interior Designer Insurance Do You Need?
Generally speaking, professional liability insurance is a must for an interior designer. Unfortunately, general liability will not always cover all the costs that may arise from an incident that occurs during an interior design project. As the interior designer, you are often entrusted to plan and effectively design the space to the customer’s expectations and deadlines.
These expectations can sometimes increase the risk of miscommunication, confusion, and rushed work, which can simultaneously boost the potential of an incident occurring. As a result, it is your best bet to protect yourself from accusations of mistakes or unfinished projects that could lead to legal action. Lawsuits can be very financially draining and time-consuming processes. Professional liability insurance prevents you from being bogged down fighting a client’s claims.
How to Manage Risk as an Interior Designer
There are many ways to manage risk within your business, all of which are part of a sound risk management program.
- Having people take ownership of their participation, such as signing waivers
- Defer risk to a third party by buying an insurance policy
- Require clients to sign service agreements
- Require contractors to sign subcontractor agreements or purchase their own insurance
Why Do You Need Errors And Omission Insurance For Interior Designers?
Interior design may seem like a low-hazard class of business, but as with any profession, there are perils and pitfalls that can cost you money and assets. It is important to discuss with an insurance professional your business and devise a plan to defer risk via a solid insurance program. A Pen-Ex program specialist can discuss your business goals and outline the best and most affordable plan to keep your business and personal assets safe. Moreover, we will do our very best to bundle coverages together, with our specialized programs, to get you the very best coverage and pricing.
What Does Errors and Omissions Insurance For Interior Designers Cover?
- Material acquisition error
- Modifications in the plan of the design
- Failing to abide by the building codes
- Failing to deliver the project in due time
- Inappropriate spatial designs
- Advice given
- Dissatisfied clients
- Property damage or injury due to professional negligence
What makes up a Sound Policy for Interior Design Insurance?
BOP (Business Owner’s Policy):
Nearly every business should start with a BOP or commercial package (depending on their industry). The Business Owner’s Policy is a packaged product of General Liability and Property coverage that includes many other “bells & whistle” coverages via premium endorsements or can have other important coverages, like Employment Practices Liability, or Cyber Liability added at a sublimit for an additional premium.
General Liability: Third-party coverage for injury or property damage. This is important coverage for a designer as you will most likely be doing work at another person’s premises. If through your own negligence, cause someone to get hurt (like leaving a tool on the ground that your client trips and falls to injury) you would be covered, not only for your client’s medical bills but if they should sue you for pain and suffering. You would also be covered should you cause physical damage to your client’s property (like knocking over a china cabinet, or scratching the floor and furniture).
Property: Under the property section you will have first-party property coverage to insure your inventory, tools, computers, office furniture, and more. Business Interruption coverage, for losses to your income, while your business is shut down due to a covered peril, also is covered under the property section of your policy.
Errors and Omissions Insurance For Interior Designers
Interior designers provide professional services. It is now becoming law that some states officially license interior designers before they can advertise themselves as holding this designation.
If you’re sued, not because of bodily injury, but because of a failure in your professional capacity, general liability policies (BOP) won’t cover you. E&O covers financial loss to a third party. If you give bad advice and recommend a floor that’s easily damaged, your general liability policy wouldn’t cover the resulting legal costs if you’re sued by the homeowner.
Designers could be sued for
- Projects that go over budget
- Advice that doesn’t work out
- Mistakes in measuring that add additional costs
- Failing to complete a project on time or on budget
E&O insurance pays for legal defense costs and any judgments or settlements arising out of lawsuits from professional misconduct, errors, and omissions. Because there’s the potential for any designer to make mistakes, essentially all decorators and interior designers need this type of coverage.
If you have employees on your payroll, or even if you are subcontracting the same people every day (which can constitute an employee equivalent from a WC perspective), you will need Worker’s Compensation insurance to cover employees’ medical and wages should they get injured on the job? Having a business where you are responsible for employees, and not covering them via Worker’s Compensation, is punishable by law, and employers can be sued by their employees, fined, or jailed.
What are the typical costs for Interior Designer’s Insurance program?
The average cost of insurance for Interior Designer’s Insurance Program can vary on the business structure, their experience in the business, claims history, the amount of property they own, whether or not they have employees or vehicles, and other various underwriting criteria. The average cost nationally for a business owner’s policy is about $1200.00 and for E&O you are going to spend another $1500- $1700. Worker’s Compensation costs will depend on the number of employees and the resulting annual payroll per classification code.
Stay Covered & Protected with PenEx’s Insurance for Interior Designers
Do not risk your and your business’s health, safety, and financial well-being by going without an adequate insurance plan for interior designers. Contact our skilled agents at Pen-Ex: A Villanova Insurance Partners Company today for a free quote on interior designer insurance and to discover what will best work for you and your business.