Engineering companies and business owners work closely with clients to create unique projects. While you might be a skilled engineer with lots of experience, you cannot rule out the possibility of mistakes. When you make a mistake that results in your clients suffering financial losses, they can sue your business for damages. 

This is why you should consider getting engineer insurance for your business. Particularly, professional liability insurance for engineers helps cover professional engineers against claims of errors, omissions, or negligence in the professional services provided. Some of the policies under it include professional indemnity insurance for engineers, errors and omissions insurance for professional engineers and engineer business insurance. And it is quite affordable.

Learn more about professional liability insurance cost and coverage options for engineers in this guide. To shed light on the importance of insurance for engineers, we will discuss what the policy covers and why you need to purchase it. We also highlight the average engineer insurance cost and some of the factors that determine its average cost.

Engineer Insurance

Professional engineer insurance is insurance specifically tailored to the nature of an engineer’s work, just like architect insurance is to a practicing architecture. It covers costs when an employee or subcontractor gets injured or when a client suffers and asks for a refund for a half-baked output or property damage.  

This insurance doesn’t cover falls, slips, and similar accidents. Therefore, it’s best to bundle engineer insurance with worker’s comp, general, and professional liability insurance to have more coverage. 

Also, an engineer’s insurance will have these insurance policies as additional options:

• Equipment policy -  accounts for repair costs for equipment like tractors, bulldozers, cranes, and trucks.

• Machinery policy - covers repair costs machinery such as grinders, jackhammers, and pulleys

• Electronic equipment policy - cover repair costs for equipment that use electricity like a welding machine 

• Contractor’s policy - covers costs made by subcontractors for injuries incurred while working

Engineering insurance isn’t implemented as a one-size-fits-all insurance policy. Insurance companies modify the terms and coverage according to the type of work an engineer does (e.g., electrical, construction, heating, mechanical, marine).  And so,  you’re sure to get coverage that best fits your needs. 

Engineer Liability Insurance 

We hope this doesn’t happen now, but one day you will encounter clients who will accuse you of being negligent and unprofessional with your work. This might result in costly lawsuits and settlements. Without an engineer liability insurance policy watching your back, you’ll spend at least $10,000.

To protect yourself from this situation, we suggest you get engineer liability insurance. This is a type-specific type of professional indemnity insurance and will account for:

• Physical injuries caused by poor design and construction of a client’s project

• Equipment malfunction resulting in property damage and bodily injuries to a client

• Failure to finish a project within a timeframe you promised a client

• Lawsuits made by a client accusing you of not doing the job properly

• Careless handling of asbestos

Since engineering is a broad profession, engineering liability insurance comes in numerous varieties, such as:

• Civil engineer professional indemnity insurance

• Construction engineer professional indemnity insurance

• Structural engineer professional indemnity insurance

• Design engineer professional indemnity insurance

• Engineering consultant professional indemnity insurance

If you make errors that result in financial losses for your client, engineering insurance protects you against such claims. This is why you should consider getting architects and engineers professional liability insurance policy for your engineering business.

Professional Liability Insurance for Engineers

Professional liability insurance for engineers is essential for your business. Professional indemnity insurance for engineers covers your company against lawsuits that a third party might file against you. This could be as a result of damages due to your professional wrongdoing. 

It is important to note that professional liability insurance for engineers doesn't cover general claims such as falls and slips, which are usually covered under commercial construction insurance. Engineering errors and omissions (E&O) insurance only covers wrongdoings related to your engineering profession. This helps you know which policy suits your business and how it protects your profession. 

Generally, an engineer professional liability policy covers your claim up to specified limits. This policy also covers legal expenses like attorney fees, miscellaneous legal costs, and settlements. 

Errors and omissions insurance for professional engineers also protects your business when one of your employees makes a mistake that results in financial losses for your client. If you are an established engineering business with several employees, you will need PI insurance for engineers. This policy protects your business as well as employees against various claims.

Professional Indemnity Insurance for Civil Engineers

Civil engineers design, plan and analyze a construction project. Lots of things that can go wrong for them. For example,  civil engineers might make a faulty design or structure without knowing it, implement the wrong concept for a building, or recommend using inappropriate materials for a project. For these mistakes, civil engineers can turn to their professional indemnity for civil engineers, which costs $800 - $2,000  annually depending on deductibles, coverage, and the amount payable. 

Professional Indemnity Insurance for Construction Engineers

Construction engineers work hand in hand with civil engineers. While civil engineers are concerned with design and planning, construction engineers realize the building project. Construction engineers’ professional indemnity insurance applies to harmful situations resulting from a failure to understand and carry out plans well. The average cost of annual premiums is $800 - $5,000. 

Professional Indemnity Insurance for Structural Engineers

The job of structural engineers is to evaluate building projects from start to finish. Simply put, what they do is ensure that construction follows the standards that ensure safety and durability. A mistake that some structural engineers make is overlooking defects, which might incur losses and injuries for a client.  When a claim is made, structural engineers can turn to professional indemnity insurance for structural engineers, which costs $4,000 - $10,000 annually on average. 

Professional Indemnity Insurance for Engineering Consultants 

Engineering consultants, such as safety consultants and security consultants, help with administrative and technical tasks so that engineers can focus on more critical tasks. Still, though their job is not as hectic, mistakes can be committed. An insurance that will save them for major expenses is professional indemnity insurance for engineering consultants. It covers errors and omissions in crafting and preparing documents.  Professional indemnity insurance for engineering consultants costs $2,000 - $4,000 annually.

Professional Indemnity Insurance for Design Engineers

As a design engineer, you must get operating engineers insurance. In your designer role, you are focused on engineering the design process that demands high expertise. No matter how skilled you are as a design engineer, there is always the risk of making mistakes. 

This is why engineering contractor insurance is essential for your business. It protects you against such cases and prevents financial losses. Some civil engineering insurance policies also cover claims related to design engineering.

• Software Engineer Insurance
• Gas Engineer Insurance
• Interior Designer Insurance
• Graphic Design Insurance
• Website Design Insurance

Other Types of Insurance for Engineers

Apart from the insurance policies discussed above, there are other types of insurance that engineers can consider. They include;

Commercial Property Insurance for Engineers

This insurance policy protects rented or owned buildings or equipment at your engineering firm. Some of the protected items in this policy include computers, toolboxes, protective equipment, wrenches, and jacks. 

Business Interruption Insurance for Engineers

This is a crucial insurance for engineering firms. When your income stops due to various reasons, this insurance policy helps cover it. The risk of not generating income due to equipment damage or failure is prevented by this policy.

Business Owner's Policy for Engineers

This is one of the most comprehensive types of engineer business insurance. It basically combines three types of insurance coverages. The policy helps protect engineering businesses from a wide range of risks including property damage.