Design Professional Liability Insurance Fundamentals – Understanding Risk Exposure

Design professionals represent a diverse group of experts including architects, engineers, land surveyors, environmental consultants, and construction managers. These professionals have very specific risk profiles requiring a distinct type of insurance coverage. Their specialized and detailed work can create unique and significant liability exposures. Protecting these professionals from unexpected and costly liability suits is essential to keeping their businesses sound and operational.

Design professional liability insurance (also referred to as PLI, E&O or errors and omissions insurance) can protect design professionals from many of these risks. But not all design professionals face similar exposure. In many cases, risk exposure is predicated upon the total number of design professionals contributing to a specific project, the varying ways they contribute, the respective amounts they contribute, and the methods used to contribute. New project delivery systems exacerbate the complexity of risk exposures by creating a more intricate network of interactions among these professionals. Today, these professionals may be geographically dispersed and interacting both synchronously and asynchronously, impacting the scope and complexity of their projects, and the associated risks of said projects.

The increasing sophistication of modern architecture and engineering, the new and evolving systems, and the aforementioned project delivery systems, can dramatically increase the number of contributors involved in a project’s design, and create a highly complex network of relationships among these design professionals. Identifying and managing risks created by evolving paradigm shifts in modern design are integral in managing professional liability among design professionals. These types of professionals and their respective professional liability consultants need to consider delegation of design responsibility, sharing of design responsibility and the other factors impacting design responsibility to help determine their respective risk exposure and applicable professional liability coverage.

Obviously, risk exposure can be impacted by the size, scope and duration of a project. Designing a private residence or modest commercial building carries a different risk profile than a large scale municipal project, bridge or office tower. That said, under-assessing a company’s liability exposure can lead to major problems with possible future litigation, while over-assessing a company’s liability exposure can lead to substantive overpayment of premiums, adversely impacting profitability.

Carefully assessing exposures today can help avoid or mitigate unplanned expenses in the future. Beyond protecting a company financially, accurate and appropriate professional liability insurance will help architects, engineers, land surveyors and other professionals operate more effectively and efficiently in the event of litigious challenges. Specialty insurance agencies can offer professional liability insurance and other types of business insurance for architects, engineers, and other design professionals. Consulting with professional liability experts to assess business risk and protect assets can improve the likelihood of continued and uninterrupted operation for these types of businesses.

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Things to Avoid in Choosing An Insurance Company to Work For

How do you pick the right company to work for as an Insurance Agent? Although there is no sure fire way to pick the right company for you to work with, you need to look into how the company hires its Sales Agents, trains them and supports them.

Over 80% of the people who take a sales position with Insurance companies will be out of the business within the first year, mainly because of their inability to locate enough new customers to sustain a new career. When we see agents earning six figure incomes that represents less than 5% of the sales force. Insurance is a great field to be in but you have to be wise if you are choosing this as a career.

There are some things we need to avoid in choosing an Insurance company to work for.

1. A manager who wants you to contact all the members of your family to make sales. This puts you on the spot, creates an imposition for your family, and is no true test of you ability to find clients. You should be contacting your family last or when you feel comfortable.

2. A manager who puts you in a cubicle with a phone and gives you the phone book and tells you to start dialing. He needs to lead by example and teach you how to prospect. Just telling you to cold call is no way to start you on an insurance career.

3. Sits you in a conference room and asks you to watch training videos. This is the worse way to learn the business.

4. Wants you to go on appointments at night. There is no reason the prospect can’t come to your office during the day. Going out at night is a thing of the past except for small companies. There will be times where you will meet working families at home in the evenings but as we enter into the 21st century we find that many people will make the time to meet when they feel it is important.

5. Working under a manager who also writes and gets leads to give to you. Sadly many of them will keep the good leads for themselves and give you the crap.

I believe a person committed to a sales profession can make a very comfortable living in Insurance sales. Just do your homework, connect to a company with good training and a culture for success; find ways to prospect successfully and take good care of yourself and your family.

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A Legal Action Plan in A Financial Plan

Arguably, legal issues are the cause of more financial losses that happen to individual and businesses than just about all other financial problems combined. These losses don’t only occur just because a person or business get sued either. They can happen because a contract is worded unfavorable against them. Legal problems happen when customers refuse to pay their bills, when suppliers can’t deliver what they were contracted to do and also when employees want to file a claim against a business.

Personally legal problems happen to people when they get a traffic ticket, when they buy a good or service that was represented as one thing but delivered as something completely different and when they too sign a contract that is worded in a way to give them little room to fight back if a deal falls apart.

Of course too, there is the fact that anyone could get sued for any reason.

Financial planning is the process of accumulating, distributing and transferring wealth. However, many financial planning practitioners fail to address the legal needs of their client in order to protect their wealth in the first place.

For those financial planners who are working with the top 10% of the population, there is a good chance that these clients have their own personal attorney’s that they work with. These attorneys can charge anywhere between $150-1000 an hour depending their specialty and location.

What I have seen is that many of the very wealthiest or those who have substantial businesses will always council with their lawyers on any important legal matter. They understand that the largest companies in the world have massive legal departments who look at every angle to give their firm an edge. In order to compete and protect themselves, understanding legal consequences of any important business decision is a must.

However, these fee’s can deter many of wealthiest of individuals from counseling with them before they make any important decision. More than likely, they have not had a big enough problem to justify spending money to get advise. Like everything in life, people tend to need to experience their own mistakes in order to justify additional costs. So instead, many will make a decisions and “wing it” hoping nothing bad will happen.

People who haven’t acquired wealth yet and are in the middle class. Forget it! Most of them are struggling to make ends meet meaning that they will never spend money to consult an attorney to keep themselves out of trouble. Some have friends or family members who are attorneys that they can occasionally ask for help but usually this only happens after they find themselves in big trouble.

Having a cost effective plan in place for legal issues is a cornerstone of a strong financial plan. Prior Preparation Prevents Poor Performance in ones pursuit of financial independence.

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