What Professional Liability Claims Can Contractors Face?
Claims Can Begin With Delays, Estimates, or Recommendations
Professional Liability disputes do not always begin with physical damage. A project owner may allege that a professional decision, calculation, recommendation, or coordination failure caused additional expense or disrupted the project.
Project Delays
An owner may allege that scheduling decisions, coordination problems, incomplete information, or project-management errors delayed completion and created additional costs.
Cost Estimate Errors
A contractor may face allegations that a budget, quantity takeoff, material estimate, or cost projection was materially inaccurate and contributed to a project overrun.
Technical Recommendations
A client may allege that a recommended material, system, installation method, specification, or technical solution was unsuitable for the project.
Design-Build Responsibilities Can Expand the Exposure
Contractors involved in design-build, delegated design, design assist, inspections, plans, specifications, or technical reviews may assume responsibilities beyond traditional construction work.
Design-Build Claims
A contractor accepting design responsibility may face allegations involving errors in design decisions, delegated design, or coordination between design and construction.
Plans & Specifications
Claims may allege that plans or specifications prepared, modified, reviewed, or coordinated by the contractor contained errors, omissions, or inconsistencies.
Inspection Errors
If a contractor provides inspection or professional review services, a claim may allege that a condition should have been identified, documented, or communicated.
Professional Coordination
Allegations may arise from failures to coordinate architects, engineers, subcontractors, schedules, specifications, or project information.
Good Records Can Matter When a Professional Dispute Develops
Contractors should clearly document professional responsibilities, recommendations, approvals, changes, and project communications so there is a record of what services were actually provided.
Define the Scope
Clearly document whether the contractor is providing design, estimating, inspections, consulting, scheduling, or professional coordination.
Keep Written Approvals
Preserve relevant approvals, recommendations, change orders, emails, and other communications involving important project decisions.
Maintain Project Records
Keep applicable plans, specifications, estimates, schedules, reports, inspection documents, and professional work product.
Review Your Policy
Confirm that the policy’s definition of professional services reflects the work the contractor actually performs and the responsibilities accepted by contract.
Does Your Contracting Business Have Professional Liability Exposure?
Best Formula Insurance can help contractors review Professional Liability options for design-build work, estimating, inspections, project management, technical recommendations, consulting, and other professional services.