Increasing Rates in A&E Professional Liability Insurance

9 July 2024

Why Are Insurers Raising Rates for A&E Professional Liability Insurance?

A recent survey by Ames & Gough revealed that most insurers plan to raise the rates for architects and engineers (A&E) professional liability insurance for the third consecutive year. The driving forces behind these increases include the impact of economic and social inflation on claim expenses and elevated risks linked to specific project types, professional design disciplines, and new project delivery methods.

How Significant Are These Rate Increases?

The survey included responses from 17 major insurance companies that cover a significant portion of the A&E professional liability insurance market in the U.S. Out of these, all but one insurer intends to increase rates. Specifically, 75% of these insurers plan to hike rates by up to 5%, while the remaining 25% anticipate increases of 6% or more.

What Is the Market Outlook According to Industry Experts?

Cady Sinks, assistant vice president and partner at Ames & Gough, describes the market as cautious yet optimistic. Despite the withdrawal of a major insurer, Sinks emphasizes that the current market adjustments aim to ensure long-term stability. She stresses the importance of insurers taking a cautious and careful look at their business to remain strong and healthy for the future.

Addressing Changes in the A&E Insurance Market

What Is the Importance of Ames & Gough’s Annual Survey?

Ames & Gough conducts an annual survey to keep clients informed about the evolving A&E landscape. This research aims to uncover new insights each year, and this year’s focus is on the necessity of a more collaborative approach due to market changes. Sinks highlights that rate increases are slightly higher and more consistent across carriers compared to the previous year.

What Are the Implications of Market Movements for A&E Firms?

With the market undergoing significant changes, it is crucial for insureds to understand the shifting dynamics. Firms with special projects or higher practice limits should work closely with their insurers early in the process to ensure their needs are met effectively.

Navigating Limit Reductions and Claim Severity

Are Insurers Scaling Back Professional Liability Limits?

While over three-fourths of insurers report consistent availability of professional liability limits, only 40% can provide limits exceeding $5 million, a notable decline from the previous year’s two-thirds. This indicates a trend of scaling back limits for single accounts.

How Are Firms Managing Higher Limit Requirements?

A&E firms now face the challenge of meeting higher limit requirements from project owners while navigating increased underwriting scrutiny. Jared Maxwell, vice president and partner at Ames & Gough, suggests negotiating with owners to justify higher limits and exploring alternative structures like specific additional limits endorsements or building layers with multiple insurers.

What Is the Trend in Claim Severity?

In 2023, only 6% of insurers reported a decrease in claim severity, while 18% experienced worsening claims. Most insurers attributed rising costs to inflation, with construction inflation outpacing general inflation due to higher prices for materials, supplies, and labor. Notably, 23% of insurers paid claims of $5 million or more, with 12% handling claims exceeding $10 million.

Responding to the Increasing Rates and Risks

What Projects and Disciplines Are Considered High-Risk?

The report indicates that 75% of insurers plan to target rate increases on accounts with adverse loss experiences in 2024. Additionally, 56% will focus on firms involved in higher-risk projects, such as residential constructions and infrastructure projects. High-risk disciplines include structural engineering, mechanical engineering, civil engineering, and architecture.

How Should Design Firms Approach Risk Management?

In light of the competitive market and increasing rates, design firms need to adopt diligent risk management practices. This includes thorough client and project selection, effective quality control, comprehensive contract reviews, and proper documentation of communication with project stakeholders.


The annual survey by Ames & Gough sheds light on the evolving landscape of A&E professional liability insurance. With rates on the rise and market dynamics shifting, it is imperative for firms to work closely with their insurers and adopt strategic risk management practices. Inszone Insurance, with its expertise in A&E insurance services, remains committed to helping clients navigate these changes and secure the coverage they need .


  1. Ames & Gough. (2023). Survey on A&E Professional Liability Insurance.
  2. Insurance Journal. (2023). Economic and Social Inflation Impact on Insurance Rates.
  3. Business Insurance. (2023). Insurers Plan Rate Increases.
  4. Risk & Insurance. (2023). Market Outlook for A&E Insurance.
  5. Ames & Gough. (2023). Annual Survey Results.
  6. Professional Liability Underwriting Society. (2023). Market Movements in A&E Insurance.
  7. Insurance Business Magazine. (2023). Professional Liability Limits.
  8. Construction Executive. (2023). Navigating Higher Limit Requirements.
  9. Insurance Journal. (2023). Rising Claim Severity in A&E Insurance.
  10. Risk & Insurance. (2023). Inflation and Construction Costs.
  11. Business Insurance. (2023). High-Risk Projects and Disciplines.
  12. Inszone Insurance. (2023). Expertise in A&E Insurance Services.

Rick Van Oppen

Senior Commercial Insurance Specialist

Rick Van Oppen is a Senior Commercial Insurance Specialist at Inszone Insurance Services, joining the company in January 2024 after the merger with Van Oppen and Co. 2. He holds a Bachelor of Arts from Whitman College, Walla Walla, WA, and is a Chartered Property & Casualty Underwriter (CPCU). Specializing in comprehensive Property & Casualty Insurance for Architects, Engineers, and Environmental Service Firms, Rick also coordinates Risk Control support services for Inszone insured clients.

Before the merger, Rick founded and managed VOCO2 from 2008 to 2023. The firm was dedicated to providing Architects, Engineers, and Environmental clients with affordable and proactive insurance solutions and Risk Control services with insured clients nationwide and in Canada.

In his time off, Rick enjoys family time, splitting his days between the Central Coast of California, where his wife teaches Elementary school in San Luis Obispo, and Jackson Hole, Wyoming.

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