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An interior designer can be quite expensive, but do they always provide enough insurance coverage? Learn the risks and how to protect yourself.
Interior design insurance is a type of insurance that covers the risk associated with designing, building, and maintaining a home. Interior design insurance can be broken into two categories: cost-based and coverage-based. Cost-based interior design insurance covers the cost of damages to the property in case of damage or loss. Coverage-based interior design insurance covers any additional risks such as liability, environmental damage, or personal injury.
Interior designer insurance is a business owner’s policy (BOP) that costs about $1,500 per year and provides reasonable coverage for property damage and personal injury. Interior designers should also consider Insurance for Professional Liability, which starts at $1,200 per year and goes up to $4,500 per year, as well as business motor insurance.
How Does Insurance For Interior Designers Work?
Interior designers are unable to get a single interior design insurance policy that covers all of their needs. They may, however, combine many kinds of critical policies into a BOP. Many insurers that provide BOPs will also enable additional add-ons, such as professional liability coverage and business car insurance, so interior designers may have all of their needs covered in one policy.
Purchasing bundled coverage is not only easy, but it also saves money in the majority of circumstances. Interior designers will need to choose a supplier that can give them with all of the protection they want for various dangers. This involves the chance of being sued, as well as the possibility of damage to their office space, car, or other property.
Costs
The cost of interior decorator and designer insurance can vary depending on the coverage you want. A BOP typically costs $500 to $2,500 per year for $1 million in coverage, while an Insurance for Professional Liability costs roughly $1,200 per year for $1 million in coverage. The cost of commercial vehicle insurance ranges from $1,000 to $4,500 per year.
The amount you pay for insurance is influenced by a number of variables, including:
- Your reputation and years of industry experience: If you’re an experienced interior designer with no claims history, Insurance for Professional Liability is substantially less expensive. You should expect to spend more if you’re just starting out or have previously been sued.
- You’re insuring the following amount of workers or vehicles: If you have more employees, workers’ compensation coverage gets more expensive, and if you have many work cars or expensive work vehicles, Insurance for Commercial Vehicles becomes more expensive.
- The worth of your property: If you have a high-end design studio with, say, numerous antique furniture that you show potential customers, you’ll need a lot more property damage coverage. This will need paying greater rates in order to get extra coverage.
Tip: You’ll spend more if you buy your policies from multiple providers since you require different forms of insurance coverage, so it’s ideal to choose an insurance provider or broker that can fulfill all of your needs. Insurers that provide bundled coverage might give insurance at a lower cost. This will not only save you money, but it will also make things easier if you need to submit a claim.
Policies
A BOP protects designers in two ways: it protects them against property damage and it protects them from litigation. Workers’ compensation insurance may be required since many designers hire staff. Professional liability coverage protects a designer if he or she is sued for giving advise. Insurance for Commercial Vehicles protects a designer when traveling to clients or retailers.
BOP
Every designer should have a BOP since it is the most cost-effective method to receive two types of insurance: general liability and property damage.
The following scenarios are covered by a BOP:
- A BOP’s commercial general liability coverage will protect a designer if a customer stumbles and strains an ankle in the design studio. It covers any litigation brought against the designer as a result of personal harm or property damage.
- If a fire breaks out in the design studio, destroying client furnishings, property damage coverage covers for both the space’s repairs and the furniture’s replacement.
Except in rare circumstances when designers never interact with customers in person and have no costly things or real estate, all designers face the possibility of someone getting harmed on their premises or property being damaged. As a result, practically all designers consider a BOP to be an essential purchase.
Insurance for Professional Liability
Professional services are provided by interior designers. According to the Bureau of Labor Statistics, several jurisdictions require interior designers to be formally licensed before they may represent themselves as such.
If you give bad advice by recommending a floor that’s easily damaged, and you are subsequently sued by the homeowner, a Insurance for Professional Liability policy would cover the legal costs.
Designers may be held liable for:
- Overspending on projects.
- Recommendations that don’t work
- Errors in measurement that result in increased expenditures
- Failure to finish a project on schedule or under budget
Insurance for Professional Liability, also called errors and omissions insurance, pays for legal defense costs and any judgments or settlements arising out of lawsuits from professional misconduct. This type of insurance covers claims where professionals make mistakes or are negligent while providing expert advice to clients. Getting this coverage is essential to making sure that interior designers are protected from lawsuits and defense costs.
Tip: Insurers consider the risk of a claim when you get Insurance for Professional Liability. So, having a long and established history of success as an interior designer will increase your chances of getting the best coverage. A minimum of three years of working experience can help you get affordable rates for Insurance for Professional Liability.
Insurance for Commercial Vehicles
When driving personal or work vehicles to clients’ homes, chances are your personal auto insurance won’t cover you because of policy exclusions for commercial driving. You’ll need Insurance for Commercial Vehicles to protect yourself from liability and to protect your property.
Designers and decorators often drive to visit clients, look at furniture or samples, and see spaces in need of decor. They may even transport materials or furniture to a client’s home. Accidents can happen any time a designer is driving, and Insurance for Commercial Vehicles pays for damage to vehicles and lawsuits arising from a collision.
If you never drive for work and no one at your company uses a work vehicle, Insurance for Commercial Vehicles won’t be necessary. However, you don’t want to go uncovered or count on your own auto insurance if you do any driving for your job.
Insurance for Workers’ Compensation
Designers may employ support staff like a receptionist to set appointments or movers to help transport furniture and materials. If you have people who work for you, you need Insurance for Workers’ Compensation.
Not only does Insurance for Workers’ Compensation protects you and your employees by providing medical and disability benefits in the event of a workplace injury, but you may also be required to have coverage. States have differing rules, and most states mandate that you buy a policy—although some locations won’t require workers’ compensation unless you employ several workers.
You won’t need workers’ compensation if you don’t have any employees. However, if you’ve formed a company and employed yourself as an employee, it’s likely that you’ll need personal insurance if your state requires it.
Other Insurance Options for Interior Designers
Consider purchasing cyber liability insurance if you store your customers’ records on your computer or utilize pricey software as part of your design process. This insurance shields you from legal action in the event of a data breach. The cost of cyber liability insurance for interior designers ranges from $1,000 to $7,500 per year.
Meanwhile, if you manage projects in addition to giving interior design guidance, you should consider acquiring contractor’s insurance. Contractor’s insurance is required in certain states, such as Connecticut, for significant contractors working on large residential, commercial, and industrial projects. It’s important to remember that acquiring contractor’s insurance can increase your prices, since builder’s risk insurance alone may cost anywhere from 1% to 4% of the project’s construction costs.
Top Insurance Companies for Interior Designers
Hartford
Hartford is one of the leading insurance providers that offers policies nationwide. With its reputation for continuous innovation, Hartford has built various policies that are not only affordable but also provide more coverage options than its competitors.
Hartford is unique in that it makes buying bundled coverage as easy as possible thanks to its Spectrum Business Owners’ Policy. With Hartford’s Spectrum Business Owners’ Policy, interior designers can get a broad range of optional coverage, increased policy limits, blanket limits ranging from $50,000 to $500,000 for all coverage, and higher limits when you increase your tier level within the Spectrum options—also referred to as your Stretch level.
Hiscox
Hiscox knows the particular hazards that interior designers encounter as a small company insurance expert. Hiscox is able to deliver tailored insurance based on individual coverage requirements thanks to this information. Furthermore, interior designers are free to pay their yearly charges in monthly installments. After completing a simple no-obligation application, you may get quotes online.
ASID Insurance
No one knows the needs of interior designers better than the American Society of Interior Designers (ASID). ASID has teamed up with The Insurance Exchange to create insurance products tailored to protect its members. If you want coverage from the foremost industry experts and products at an unmatchable price, opt for ASID Insurance is a company that provides insurance to those who.
Veracity
Veracity is a wonderful option whether you have a big or small design business that requires coverage and wants the shortest possible approval procedure. Veracity has contractual authority with top-rated insurance providers, and its own in-house underwriting process means you may be insured quicker while still obtaining the benefits of comparison shopping.
Insureon
Insureon is a small business insurance provider that is excellent for small interior design companies looking for a large number of quotations. With Insureon, you may locate alternatives from numerous carriers by filling out a single application in around 10 minutes. An agent with a lot of expertise working with small businesses can help you figure out which insurance is best for you.
Conclusion
Working as an interior designer may not seem to be a high-risk career, but if anything goes wrong and you don’t have the correct insurance, you might lose a lot of money. When you get packaged coverage from an insurer that covers any losses incurred as a result of work you execute, you’ll have the peace of mind that your design firm is protected even if calamity strikes.
