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General Liability Insurance for Building Design Businesses

General Liability Insurance for Building Design Professionals

Get a quote on General Liability Insurance

In any business, accidents can happen, and there is risk for lawsuits over injury or property damage. In the building design industry, you may host clients, partners, or other third parties at your offices, or you may visit clients at their homes, exposing you to liability risk. Commercial general liability insurance can help protect your business from these risks.

What is General Liability Insurance?

General Liability Insurance, also known as Commercial General Liability Insurance, protects your building design business financially from lawsuits and damages that arise while doing business. Since architects, engineers, and other building design professionals are interacting frequently with clients either at their own premises or their customers’ premises, General Liability Insurance is an important coverage to have. It pays for bodily injury and property damage that is unintentionally caused by your business in the course of your business operations.

General Liability Insurance is one of the most common types of insurance that businesses purchase. It can help protect your business financially if someone else is harmed by your business and sues your company. General Liability Insurance is third-party insurance, which means it covers you against claims by third-parties, which don’t include your business or your employees. Third parties may include customers, vendors, or landlords.

What does General Liability Insurance cover?

General Liability insurance typically covers property damage, bodily injury, products and completed operations, and personal and advertising injury. It also covers the costs of any legal defense or attorney’s fees incurred while defending against covered lawsuits.

Property Damage

General Liability Insurance will pay for the damages if your business or one of your employees causes property damage to another person or company’s property.


General Liability Insurance does not provide coverage for damage to your own business property, only for damage to the property of others. For coverage of your business property, you would need commercial property insurance.

Another important exclusion to property damage coverage is property belonging to others that is under your care, custody, or control.


To protect against such incidences, you’ll need an additional endorsement to your property damage insurance, often known as voluntary property damage. Voluntary property damage provides coverage for unintentional damage to others’ property while that property is under your care, custody, or control.

Bodily Injury

This aspect of General Liability Insurance covers your business if a third party who is not an employee suffers a bodily injury while on your business premises or in the course of your business operations.


If your company is found liable for injury, bodily injury coverage will pay for damages to the other party. These damages might include the injured party’s medical expenses as well as lost income from not being able to work, pain and suffering, and funeral expenses.

Products & Completed Operations

Products liability covers your business if the products you sell are defective or have a faulty design and cause either bodily injury or property damage. It is important to note that products liability does not cover defects in products if they do not cause injury or damage. This coverage also excludes the costs of a recall.


Completed operations covers your business if there is property damage or bodily injury caused by work your company has completed for a client. This generally applies to design-build firms in which the company’s architects or engineers design the structure and the firm also manages the project construction.


Personal & Advertising Injury

Personal and advertising injury provides coverage for several non-physical reputational injuries that are specifically defined. While bodily injury and property damage cover unintentional acts, personal and advertising injury covers intentional acts that may have unintended consequences.

The areas covered by personal and advertising injury include:

False Arrest and Malicious Prosecution

Publications That Violate Privacy

This includes the use of a person’s name or likeness without permission or intrusion into someone’s private affairs. It also covers advertisements that show others in a false light or public disclosure of embarrassing private facts.

Slander or Libel

Copyright Infringement in Advertising

Legal Defense

If your building design company is sued for a cause covered by the insurance policy, General Liability Insurance will cover the costs of your legal defense, including attorney’s fees, expert witness fees, and court costs. These fees will be covered whether or not your company is found at fault.

These legal fees don’t count against your limits of coverage for most General Liability Policies. For example, if your policy has a limit of $1 million, and you are liable for a judgment of $1 million plus $250,000 in legal fees, the insurance company would pay for all $1.25 million in costs.

What are the key exclusions of General Liability Insurance?

There are several common exclusions to General Liability Insurance you should know about:

Your business property. Liability insurance only covers damage to the property of others. If one of the employees at your interior design firms slashes all the paintings displayed in your office on a bad day, you won’t be covered by General Liability. For coverage of your own property, you need commercial property insurance.

Damage caused intentionally. For example, during a heated argument at the client’s project site, an employee of yours throws a chair against the wall, damaging the client’s chair as well as the wall.

Liability resulting from crimes or fraud. An employee of your engineering firm has stolen tens of thousands of dollars from your company through check fraud. To cover this, you need commercial crime insurance.

Professional errors. For example, if one of the architects at your firm fails to turn in a blueprint on time and it delays the project, General Liability will not cover the financial losses. To cover this, you need professional liability insurance.

Employee injuries. For example, if one of your civil engineers gets injured at the project site, General Liability will not cover his injuries. For employee injuries, you should buy workers’ compensation insurance.

Employee discrimination lawsuits. For example, one of your employees sues for gender discrimination after not receiving a promotion. Employment practices liability insurance covers employment-related issues such as discrimination, harassment, and wrongful termination.

Automobile crashes. For example, one of your engineers rear ends another vehicle on the way to a client meeting. For auto coverage, you need commercial auto insurance.

Is General Liability Insurance required for building design professionals?

General Liability Insurance is not legally required in most cases, but many clients in the building design industry will require you to have General Liability Coverage before working with you. It is a foundational insurance policy that most businesses will carry.

What are the limits of General Liability Insurance?

The limit of insurance is the maximum that the insurance company will pay in claims. It is common in General Liability Policies for there to be separate limits “per occurrence” and “per year.” The “per occurrence” limit is the maximum that the insurer will pay for a single loss, while the “per year” limit is the maximum they will pay for the policy year.


Pricing and Quotes

AdvisorSmith found the average cost of General Liability Insurance for building design firms was $521 per year. This average cost was based on building design businesses with up to $500K in revenue for coverage of $1 million per occurrence and $2 million in aggregate.

Pricing for General Liability Insurance is based upon the unique risks your business faces. Insurers consider factors such as:

Businesses with higher risks will have higher premiums than those deemed lower risk. For example, an design-build firm with a history of multiple claims will probably have higher liability premiums than one with relatively few past claims. Premiums also rise as you increase the limits of insurance. Different insurance companies have different models for rating risks, so it is worth comparing pricing across different insurers.

In order to get an accurate estimate on pricing, it’s best to get a quote from a reputable insurance company. Below we’ve highlighted a few of our trusted partners who offer General Liability Insurance:

ProviderGeneral LiabilityBusiness Owner's PolicyProduct Liability

Final Word

Throughout the normal course of your business operations, there will be damages that your business or your employees may cause. Whether it’s an accident that damages your client’s property, an injury in your office, a defective product that hurts someone, or a copyright infringement, General Liability Insurance offers financial protection for various liabilities arising from third-party property damage, bodily injury, and personal and advertising injury. It’s not mandated by law in most cases, but many clients in the building design industry will require it. General Liability Insurance is a foundational insurance coverage that most building design firms will carry.

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