Why Specialized Insurance Matters
Here’s a real story of risk — caught in time.
The best risk management stories are indeed the ones where nothing bad ever makes the headlines, because the problem was caught before it caused harm.
A local mid-sized engineering firm was gearing up to submit a proposal for a large public infrastructure project. They were confident in their design capabilities, but hadn’t reviewed their insurance with their broker in over two years. That’s when CH Insurance’s risk management expert, Tony D’Amato, stepped in.
During a proactive risk assessment, Tony noticed a major gap: their professional liability coverage didn’t include language for public sector indemnification — meaning if something went wrong on a government project, they could be on the hook personally, not just as a business.
Even more alarming, they had no cyber liability coverage, despite relying heavily on digital tools like CAD and project management software, and regularly exchanging plans via email with subcontractors.
Tony worked directly with the firm’s leadership to redesign their insurance portfolio — customizing a program that included expanded E&O coverage, cyber liability, and contractual protections specific to public-sector work.
A few months later, one of their vendors experienced a phishing attack, which exposed sensitive communications related to a design specification. Thanks to the new cyber policy and protocols Tony helped put in place, the issue was contained, and the firm suffered no losses.
No lawsuit. No reputational damage. Just business, protected.
Insurance Portfolio Designed For You
What does this mean for you? The engineering and architecture industries are at the forefront of innovation, designing the spaces and infrastructure that shape our world. But with this innovation comes a unique set of risks, many of which cannot be fully addressed by standard insurance packages. As an independent insurance brokerage with deep roots in the Central New York business community, CH Insurance understands the specific challenges faced by professionals in these fields. In this article, we’ll explore some of the key risks these industries encounter and how a tailored insurance program can mitigate potential losses.
Unique Risks in Engineering & Architecture
Engineering and architecture firms are constantly balancing creativity with technical precision, but no project is without its potential pitfalls. Whether it’s the design of a new building or the infrastructure for a critical system, each decision has the potential to introduce risks that could jeopardize a firm’s financial health.
Liability Risks in Design and Construction
One of the primary risks for engineers and architects is the potential for design errors or omissions that lead to construction issues. A design mistake can result in costly delays, safety violations, or structural failures. For these reasons, professional liability insurance—also known as errors and omissions (E&O) insurance—is a crucial safeguard. This coverage protects professionals against claims of negligence, errors, or failures to perform as expected, ensuring that firms aren’t left financially vulnerable if something goes wrong.
Contractual Risks and Third-Party Liabilities
Many engineering and architectural firms work on large-scale projects that involve complex contracts and numerous stakeholders, including contractors, subcontractors, clients, and vendors. These contracts often come with built-in risks, especially regarding liability for accidents or failures that may occur during construction. Having coverage that addresses explicitly contractual liabilities can help firms navigate these complicated agreements with peace of mind.
Cybersecurity: A Growing Concern for Architecture and Engineering Firms
With the growing reliance on digital tools like Building Information Modeling (BIM), Computer-Aided Design (CAD), and project management software, architecture and engineering firms are more vulnerable than ever to cyber threats. A data breach could result in the loss of sensitive intellectual property, blueprints, or client information—all of which have significant value and security implications.
Ransomware and Data Breaches
The risk of ransomware attacks or cyber theft is ever-present. A breach of sensitive designs or client information can be devastating, both financially and reputationally. Cyber insurance is becoming an essential component of a comprehensive risk management strategy for firms in these industries. This coverage helps protect against data loss, business interruption, and the costs associated with recovering from a cyberattack. Moreover, it can provide access to cybersecurity experts who can help reduce the risk of attacks.
Supply Chain Cyber Risks
It’s also important to note the risk posed by third-party vendors. Engineering and architecture firms rely on a variety of subcontractors, software providers, and supply chain partners, many of whom have access to the firm’s data. If one of these parties suffers a data breach, it could have significant repercussions for the firm itself. A comprehensive cyber insurance policy should consider these interconnected risks to ensure that all potential exposures are covered.
Best Practices for Risk Management
Beyond insurance, risk management is an essential component of running a successful architecture or engineering firm. The most effective way to prevent losses is to identify and address risks before they escalate into claims.
Comprehensive Risk Assessments
Regular risk assessments are a proactive way to evaluate your firm’s exposures. Identifying potential liabilities—whether they’re contract-related, operational, or cyber-related—will help guide the type of coverage your firm requires. Collaborating with a knowledgeable insurance broker to conduct these assessments can provide valuable insight into how to tailor your coverage to specific needs.
Claims Prevention & Loss Control
Implementing effective loss control measures, such as safety protocols, regular training, and robust cybersecurity practices, can reduce the likelihood of claims. Additionally, ensure that your team is well-versed in contract management and compliance requirements to minimize exposure to legal liabilities.
Customized Insurance Programs
Insurance isn’t a one-size-fits-all solution. A specialized, tailored policy that addresses the unique risks of your business will provide much better protection than a generic option. Whether it’s professional liability, general liability, cyber insurance, or business interruption coverage, having a policy designed for your industry can make all the difference.
How CH Insurance Can Help
At CH Insurance, we understand the unique risks and challenges faced by businesses in the engineering and architecture industries. Our local team works closely with firms to design your insurance for you as uniquely as the projects they undertake. We don’t just provide policies—we partner with you to assess risk, manage claims, and ensure your firm is protected from potential exposures.
As a local, independent insurance brokerage, we’re committed to helping businesses across all industries succeed by providing personalized, reliable, and timely insurance services. We take pride in our in-depth understanding of the risks facing Central New York’s diverse business community and our ability to deliver comprehensive solutions.
In Your Corner
At CH Insurance, we’re more than just your insurance provider; we’re your partner in risk management. We’re proud to be part of the CNY business community and committed to supporting businesses across all industries. Whether you’re an engineer, architect, or small business owner, every day in every way… we’re in your corner.