Risk Management
26th February 2019 / Roger Hawkins
Professional Indemnity Insurance and Risk Management
Hawkins Brown facts:
30 million turnover
60% Staff
1 000 000 Rent
300 000 PI (low because of claims record)
Analogy: Motor policies
- 1st party (own loss)
- 3rd party (others loss, other related damages)
Professional Context
PII required by ARB since 1 April 1988
Other professions have similar setups
Clausal
Contractual
Non-disclosure issues, when to contact your insurer - judgement
- keep your broker informed, they expect problems to brew around buildings, the earlier they are involved the easier it is for them to minimise their risk
Potential scenarios
Planning conditions to be met can be claimed against and policies could cover potential demolition costs
Cost over-run are good things to insure against as they are often out of your control and gives peace of mind
Negotiation > Adjudication > Arbitration > Courts of Law
Insurer’s perspective
Insurers want to know your specific experience with some building typologies through questionnaires
Policies worth considering
Hacking client's data (cyber threats)
Most policies won't cover North America because they are 'litigatious'
Run-off cover (after project is complete)
BIM cover? Shared responsibility?
Risk Management
basic process:
- Identify
- Evaluate
- Mitigation (seek specialist assistance)
- Result
With BIM:
be clear what service you are providing (drafting, specifying etc.)
Recent updates to regulations
Regulated by the insurer? Combustible materials etc.
Various forms of agreements and risk levels
PSC (Professional Services Contracts): Engaging With Your Clients
PSA (Professional Services Agreement) = Appointment (differentiate from 'contract')
Confrontational contracts (?)
Latest appointment amendment deal with the latest legislation, insurance, etc.
ARB Code of Sanctions
Influence on insurance and risk?
Appointment Contract
- parties
- fees
- scope
- liabilities
- legal
- dispute resolution
- suspension/termination
- ARB Code of Sanctions
Code/Rule Law (few exceptions) vs Base Law (contextual)
Consumers vs Commercial clients
- depends on in what capacity they act, not what type of project/building
Contract details
- terms capitalised
- legal requirements are sign-posted by specific words such as 'must', 'shall', 'can' etc.
Duty of Care = risk management, professional judgement
Copyright
Fosters make the most money off keeping the copyright to their product design
Risks with Bespoke Contracts
Architect's rights might be removed in a Bespoke Contract