ENR Article on Insurance Threat

[jike]

Have any of you read the recent article in ENR November 15, 2004? It is titled "Structural Engineers Join to Tackle Insurance Threat".

The frequency of claims is about double for structurals vs. other engineers. Last year, the average cost per firm for defense and indemnity of paid claims about $230k was almost 30% higher than other engineers.

Since we are such a small part of the insurance business, there may be a future time where we may not be able to buy insurance. I understand CASE has a committee working with the insurance industry to try to address this issue. Some suggestions are better aggressive internal and external management, limitation of liability in contracts, larger fees and self regulation of the profession.

Any thoughts?

 

[JStephen]

My first thought would be, is this situation any different from years past? The article may make that plain, but your post doesn't. It would certainly be natural that people that designed expensive things would incur more liability than people that didn't, so I don't know that the comparison across different types of engineers really means much. Kind of like comparing insurance between, say, a brain surgeon and an allergist.

 

[vmirat]

I just read the article. I think it's just indicative of how litigious our society has become. I would be interested to know what percentage of claims against structurals were actually legitimate. I suspect the lawyers just sue everybody in sight and hope to get the maximum judgement possible. I would also be interested to know how many suits are filed by the structural firm's clients versus outside parties (i.e. the contractor). At this point, I think our only recourse is limited liability clauses and increased fees to pay for the insurance, although I'm not sure a limited liability clause will hold up in court these days. Maybe the structural engineer of the future will be single, drives a 10-year old car, has no liability insurance, and lives in an apartment. That way, it's not worth sueing the poor slob.