Interior design is a rewarding and creative career path. However, there are risks of being an interior designer just like any other job or industry. For example:
- Injury might occur while moving heavy objects in or out of spaces.
- Expensive furniture might get dropped or damaged while being transported.
- You might make a mistake and a project falls through the cracks and your customer loses a significant investment.
The reality is that things happen, but there is a lot that you can do to protect yourself when things don’t go as planned. In this article, we explore the ways that you can protect yourself and your business by reducing the risks of being an interior designer.
Use Subcontractor Agreements
Working with subcontractors is a necessary part of the industry. This collaboration brings the designer’s and their client’s visions to life. However, sub-contractors can sometimes fail to meet the standards you or the client expects. Using subcontractor agreements ensures that both the interior designer and the sub-contractor are clear on the responsibilities, objectives, budget, deadlines, and resources for a project. When these elements are clearly outlined in a sub-contractor agreement, there is less room for dispute if things go wrong.
At a minimum, the independent contractor or subcontractor agreement must have the indemnity and defense clause that requires that independent contractor to defend and hold harmless your company. The agreement should also have two necessary provisions. One provision that outlines the scope of work that the independent contractor is going to do. A second provision that protects your business from an independent contractor soliciting your referral sources, or clients, or taking your business to start their own. PenEx offers free subcontractor agreements, created by an attorney, to protect your interior design business from the risk of claims and lawsuits from subcontractors.
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Require Subcontractors to have or provide Worker’s Compensation Insurance
Worker’s compensation insurance not only ensures that the employee has access to funds to cover medical bills or lost wages, but it also protects the employer from needing to pay for such expenses out of their own pocket. If a subcontractor does not provide their employees with worker’s compensation coverage, the injured subcontractor may pursue your business to help cover those costs. Ensuring that subcontractors who you work with have worker’s compensation insurance creates an additional layer of protection for you and your interior design business.
Use Service Agreements for All Interior Design Projects
Similar to a subcontractor agreement, having a signed service agreement in place with each of your clients establishes the expectations and scope of the project. If a client makes a claim about your work, you can easily refer to the agreement that outlines the timeline, responsibilities, services, and limitations of liability for the project.
Learn more about Interior Design Service Agreements:
Have a Lawyer Review Your Service Agreement Template
One of the best ways to ensure that your service agreement protects you from the common risks of being an interior designer is to have an attorney review it. An attorney will have an acute understanding of the type of exposure that interior designers face and can help you draft language to prevent claims should they arise. They will also be knowledgeable of the laws relating to contracts and contract clauses for your state. Best of all, an attorney will be able to notify you of any risks that you may not have previously thought of and can direct you to include language in your service agreement that protects against risks that you might not have previously considered. For these reasons, having a lawyer review your service agreement template is an investment worth making. At PenEx, we can review your current service agreement or provide you with an attorney-approved service agreement template tailored to your state.
Have the Proper Insurance (E&O, General Liability, and Workers Compensation)
There are lots of ways that you can protect yourself from risks, but the truth is, no matter how well-protected you are, claims happen. Having interior designer insurance is truly the best way to make sure your business is protected. Interior designers should have error and omission coverage to protect against mistakes, general liability coverage to protect against property damage, and worker’s compensation coverage to protect against injuries. At PenEx, we can help you determine the best coverage for your interior design business. Contact us today for a quote!