"New blocks are growing and there are no accidents," sang a popular Polish T.Love band in the late 1990s. Although almost 30 years have passed since the song was released, and (traffic) accidents have unfortunately been increasing lately, new blocks of flats are still growing.
In fact, the landscape of cities in Central and Eastern Europe (CEE) is changing year on year—entire housing estates are being built, and empty spaces are being developed for new investments. Demand drives the economy—after all, someone has to build it. And before that, someone has to design it.
The construction process requires the involvement of a number of people, most of whom need to be licensed. The Construction Law in many CEE countries defines independent technical functions in the construction industry as activities that require professional assessment of technical phenomena or independent solutions to architectural, technical, and organizational issues. Examples of such activities include designing, checking architectural and construction designs, and exercising author's supervision. The Construction Law places requirements on persons performing independent technical functions in the construction industry to have the appropriate education, practice, and examinations. The high requirements for entry into the profession are matched by the scope of responsibility indicated in the law.
A designer may incur professional liability for improper performance or non-performance of duties, as well as criminal liability (both of which derive directly from the construction law) and civil liability in connection with the performance of independent technical functions. The latter can become the subject of insurance.
Legislation in many CEE countries even provides for an obligation to insure architects and civil engineers who are members of the respective chambers. Unfortunately, more than 20 years after the issuance of regulations on this issue, the minimum guarantee sum can often seem inadequate—how else can the sum of EUR 50,000 be defined in comparison to the value of the projects prepared? Furthermore, it must be remembered that compulsory insurance is not complete; it also contains exclusions. Therefore, it becomes crucial to find the right insurance coverage—the widest possible from the perspective of the scope (type of damage for which the insurer will be liable) and optimal from the perspective of the guarantee sum (limit of the insurer's maximum liability).
What is worth paying attention to? Undoubtedly, it is important what type of activities a given entity performs (e.g., only design, or also author's supervision) and what type of projects it executes (e.g., only residential construction or construction of roads and motorways). Although a broader catalogue of activities performed or involvement in higher-risk construction projects will result in higher insurance premiums, ensuring the fullest possible protection should be the number one goal of any professional. The requested limit should be optimal—it should provide the architect or civil engineer with real security in the event of a loss.
The geography of the projects carried out (within the CEE region, the European Union, or other countries outside the EU) and their scale (value of revenues, value of investments, value of remuneration) will also be important for the insurer before preparing an offer. One should also not forget about the internal structure—how many employees there are, how many of them have construction qualifications, what their experience is, and whether subcontractors are used. The way the architect manages their office (ensuring quality standards, using their own contract templates) can also influence how the insurer will assess the risk. History should also not be overlooked—whether there have been damages, claims, or disciplinary proceedings in recent years.
It may seem that concluding architects' liability insurance contracts is a very complicated and time-consuming process. It certainly requires an effort from the interested party when it comes to collecting the necessary data. But it should be mentioned that the insurers' questions usually take the form of a structured questionnaire, and there are many qualified insurance intermediaries on the market, ready to support the client.
And that insurance is a guarantee of architects' financial security—we will prove in the following articles by showing examples of damages.