Architects' boards or legislation in six states and territories require practising architects to be covered by professional indemnity insurance (see the table below).
Professional indemnity insurance is designed to cover claims that your advice, service or work caused a client financial loss. It may include legal defence costs, compensation and any settlement you are legally liable to pay, subject to the policy terms.
Many architects arrange professional indemnity insurance alongside public liability insurance, which is designed to cover injury to a person or damage to their property. Cyber, contents and portable equipment, management liability and workers' compensation insurance are designed to cover other risks as a practice grows.
Cover depends on the policy and insurer you choose. Check the policy wording and its terms and conditions for what is and isn't included.
Key takeaways
- Dollar minimums differ: $1 million in Victoria, Western Australia, South Australia, Tasmania and the Northern Territory. NSW and Queensland set no dollar figure, and the ACT requires disclosure to clients rather than cover.
- Public liability policies commonly exclude claims arising from design or professional advice, which are the claims professional indemnity is designed to respond to.
- Client contracts and tenders may ask for a higher professional indemnity limit than any minimum your board sets.
Is professional indemnity insurance mandatory for architects?
Professional indemnity insurance is mandatory for practising architects in most states and territories. Each state and territory sets its own rules, through its architect's board or legislation.
| State or territory |
What the board or legislation requires |
| New South Wales (NSW) |
Architects must maintain professional indemnity insurance appropriate for the architectural services they provide (NSW Architects Registration Board) |
| Victoria |
Practising architects, including employees, must be covered by professional indemnity insurance of at least $1 million for each claim, or $1.2 million where defence costs are included (Architects Registration Board of Victoria) |
| Queensland |
Architects must take all reasonable steps to maintain cover appropriate for the services they provide (Board of Architects of Queensland code of practice) |
| Western Australia |
Architects in the practising division must hold at least $1 million (Architects Board of Western Australia) |
| South Australia |
Architects must be insured to the extent the board approves, unless the board grants an exemption (Architectural Practice Act 2009, s 59). The board's guidance sets at least $1 million for any one claim and in the aggregate (Guidance Note 1) |
| Tasmania |
Architects must hold at least $1 million (Board of Architects of Tasmania) |
| Australian Capital Territory (ACT) |
Architects must give clients evidence of the cover they hold before providing a service, or tell them they have none (ACT Government) |
| Northern Territory |
Architects providing architectural services must hold at least $1,000,000 (Northern Territory Architects Board) |
Swipe left or right to see the full table.
In NSW, registered design practitioners under the Design and Building Practitioners scheme must also hold professional indemnity insurance, required from 1 July 2022. Rules for employees and non-practising architects differ between boards, so confirm what applies with your own board.
What insurance does an architect need beyond professional indemnity?
Beyond professional indemnity, architects commonly consider public liability, cyber, contents and portable equipment, management liability and workers' compensation.
| Cover |
What it is designed to cover |
| Public liability |
Claims for injury to a person or damage to their property connected with your business |
| Cyber |
Costs after a data breach or cyber attack, such as incident response, notifying affected people and data recovery |
| Contents |
Insured damage to equipment and furniture at your premises, such as workstations and plotters |
| Portable equipment |
Insured loss or damage to equipment you take away from your premises, such as a laptop taken to site |
| Management liability |
Claims about how a business is run, made against the business and its directors, officers and managers |
| Workers' compensation |
Wages and medical costs when an employee has a work-related injury or illness, legally required for employers under the relevant state or territory scheme |
Swipe left or right to see the full table.
Contents and portable equipment cover may be available as sections of a business pack insurance policy, which bundles several covers into one policy. Contents and portable equipment cover generally sit outside a professional indemnity policy.
What do professional indemnity claims against architects look like?
Professional indemnity claims generally involve an allegation such as negligence, and any financial loss that may have arisen from this. Refunds or the cost of redoing your own work are commonly excluded. These examples appear on upcover's architects insurance page.
| Claim |
Hypothetical claims example |
Is this covered? |
| Client Financial Loss Claim |
A client relies on an architect's design specifications to proceed with a project. The specifications prove incorrect, leading to unexpected rework and budget overruns. The client makes a claim alleging the architect's advice contributed to their financial loss. |
Professional Indemnity insurance is designed to respond to claims arising from alleged negligence, errors or omissions in your professional services, including defence costs and compensation. |
| Design Documentation Error |
An architect issues design documentation containing an incorrect structural detail. The error is identified during construction, requiring redesign and rectification works. The client alleges the mistake caused delays, additional consultant costs and increased build expenses and seeks compensation for the resulting financial loss. |
Professional Indemnity insurance is designed to respond to claims arising from alleged negligence, errors or omissions in your professional services, including defence costs and compensation. |
| Contract Documentation Dispute |
An architect prepares project reports and contract documents containing inconsistent scope details. A dispute arises between the client and builder, with the client alleging the documentation errors contributed to delays and additional construction costs and making a claim against the architect. |
Professional Indemnity insurance may respond to claims arising from errors or omissions in professional reports, contracts and written documentation prepared in the course of your work. |
| Intellectual Property Infringement |
An architect unintentionally incorporates design elements similar to another firm's copyrighted work into a project. The third party alleges infringement and seeks damages and legal costs, claiming the design was used without permission or licence. |
Professional Indemnity Insurance may respond to claims arising from unintentional intellectual property infringement in the course of providing professional architectural services. |
Swipe left or right to see the full table.
Important: These claims are examples only. Cover is subject to policy terms, conditions and exclusions. Policy wordings vary between insurers. Always refer to the policy wording and its terms and conditions for details. If you have questions about a particular possible claim or would like assistance about whether a certain claim might be covered it is always best to speak to an upcover team member or your insurance broker.
Whether a policy responds to intellectual property claims varies between policy wordings, so always check with your insurance broker or the team at upcover.
Why does the defective design exclusion matter to architects?
A defective design exclusion removes cover for losses caused by design errors or poor specifications. Public liability policies commonly exclude claims arising from design, specifications or professional advice.
Design is an architect's core service, so design claims are the kind professional indemnity insurance is designed to respond to. Whether a policy responds to a particular design claim depends on what the claimant alleges, the policy wording and the insurer's assessment. Design-related exclusions vary between policy wordings, so always check with your insurance broker or the team at upcover.
Does your policy schedule list all your architectural services?
A professional indemnity policy is designed to respond to claims arising from the professional services described on your policy schedule. That is why naming each service in your activities section matters, particularly where you have the certificates and training to offer it as an added service you charge for. An architect's services can include design and documentation, specifications and material selection, coordinating other consultants, site inspections and contract administration.
Insurers may also ask about work you subcontract, work you do as a subconsultant, services beyond architecture and project types new to your practice. A proposal form or record of answers records what you asked for.
Our guide to choosing professional indemnity insurance explains how to check the services description. Whether a policy responds to work you pass to subcontractors varies between policy wordings, so always check with your insurance broker or the team at upcover.
If a client makes a claim about a service your schedule leaves out, the insurer may consider declining it if they were not aware of the activity and would not have accepted it as covered under the insurance policy. Where an insurer agrees to add a new service, it usually does so by endorsement: listing the activity on your policy schedule and issuing a written change to your policy. This may cost an additional fee.
What does professional indemnity not cover for architects?
Exclusions commonly include, but are not limited to:
- Claims and circumstances you knew about before the policy started
- Services not listed on your policy schedule
- Services provided before the retroactive date, the earliest date of past services the policy may respond to
- Liability you take on under a contract that would not otherwise exist under the law, known as a contractual liability exclusion
- Dishonest, fraudulent or criminal acts by you. Dishonesty by an employee may sit under the crime or fidelity section of a management liability policy, designed to cover losses from employee dishonesty, where you arrange one
- Refunds, or the cost of redoing, correcting or improving your own work
- Claims brought in courts in the United States or Canada
- Fines and penalties that cannot be insured at law
- Injury or property damage from an accident connected with your business, which generally sits with public liability
- Cyber incidents and data breaches, which generally sit with cyber insurance
Important: This list is not exhaustive. Exclusions vary between insurers. Always refer to the policy wording and its terms and conditions for the exclusions that apply to you, and if you have questions you should speak to your insurance broker or the upcover team.
How is an architect's professional indemnity limit set?
An architect's professional indemnity limit commonly starts from any minimum set by the board, shown in the table above. Client contracts and tenders may ask for more, and the value of the projects you document also matters.
The specified limit is the most the insurer may pay, subject to the policy terms. It may apply per claim, in the aggregate (the most the insurer pays in total for the policy period) or both.
Defence costs may sit within or outside the specified limit. Within it, spending on lawyers and investigations reduces what remains for compensation and any settlement; outside it, defence costs are generally paid in addition.
An upcover team member or an insurance broker can talk through what those limits mean for a practice like yours. Our guide to choosing a level of professional indemnity cover sets out common limits by profession.
What insurance does an architect need as a practice grows?
The insurance questions change as a practice grows. If you move from sole practice to employing staff or working through a company, who is insured and which requirements apply may change.
| Your setup |
Questions to ask |
| Sole practitioner |
Is the right person or entity named as the insured, and does the schedule list every service you offer? |
| Subconsultant to another practice |
Does the head consultant's agreement require you to hold your own cover, and at what limit? |
| Practice with employees |
Does the policy extend to staff, and do you hold workers' compensation? In Victoria, architects working as employees must also be covered. |
| Practice run through a company |
How may claims against the company and its directors be covered, for example under management liability? |
Swipe left or right to see the full table.
How does claims made cover work for architects?
Professional indemnity is generally a claims made policy. That means a claim can occur in the period of insurance when it is brought against you. That could be a letter of demand, a writ or a civil suit.
It is not typically an 'occurrence based' policy, which is triggered by the date the services were originally provided. So it is important to keep your cover active and continuously in place (also called continuity of cover).
This then means the retroactive date on your schedule should cover you for claims brought from services for as long as you have been providing them. You can ask your insurance broker or the upcover team about how you can also get an unlimited retroactive date.
If a policy lapses, a claim may arrive with no policy in force to respond.
When should you tell your insurer about a complaint?
If you're concerned about a particular client service or experience, you can always consider telling your insurer as soon as you become aware of an incident, complaint or circumstance that could lead to a claim. Importantly, this doesn't impact your premiums or cost of insurance until a claim arises, and it means that any future claim is triggered from the original date you notified the insurer, so it helps spread the risk of claims across policy periods too. You don't need to wait for a formal demand.
Also keep in mind that notifying of a claim late may affect your claim.
You can start a claim through the make a claim page. Admitting liability, incurring costs or agreeing to a settlement before you notify your insurer may affect your claim. Starting a claim does not confirm that your claim is covered; your insurer assesses it under the policy terms, conditions, exclusions and limits.
How does run-off cover work when you stop practising?
A complaint can arrive years after the services were provided, so the end of a policy matters.
Run-off cover keeps the window open for past work after you retire, stop operating, sell your business or exit your industry and go back to employed work. It is usually arranged for a set number of years. The period varies between insurers.
Importantly, it can only be arranged from your existing insurer with your current insurance policy. Architects commonly discuss it with an insurance broker before a policy is cancelled and before they exit the industry or business, rather than after.
How much does architect insurance cost in Australia?
Architect insurance prices vary with the details you give the insurer. Our guide to professional indemnity insurance cost explains what drives the price across professions. For an architectural practice, the factors include:
- Fee revenue
- The services you provide and the project types you work on
- The specified limit you choose and the excess, the amount you contribute to a claim
- Your claims history, including any circumstances you have notified
- Your retroactive date
How upcover can help
upcover arranges professional indemnity insurance for architects. upcover works with 80+ insurance partners and can arrange quotes from a range of insurers.
- 70,000+ businesses covered across Australia
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Get a quote for your architectural practice, or read our guide to insurance for engineering consultants.
Frequently asked questions
Are architects personally liable for their work?
An architect may be named personally in a claim about their professional services, even where the practice runs through a company. How liability falls depends on the contract, the business structure and the circumstances. A lawyer can advise on a particular situation.
Is professional liability the same as professional indemnity?
Professional indemnity is the usual Australian term, used by architects' boards and insurers. Professional liability is a term more common overseas for similar cover. Wordings, triggers and exclusions differ between policies, so the policy wording tells you more than the name.
Is landscape architect insurance the same as architect insurance?
Landscape architecture is a separate profession, and the Australian Institute of Landscape Architects notes that the title 'landscape architect' is not protected by legislation. A policy is designed to respond to the services described on its schedule. A landscape architecture practice describes its own services when it applies for cover.
Does the builder's insurance cover my architectural advice?
A builder's policies are generally arranged for the builder's business. A claim about your design or documentation may be made against your practice. It is the kind of claim professional indemnity insurance is designed to respond to.
Do architects and engineers need the same insurance?
Architects and engineers both commonly arrange professional indemnity insurance, because both provide design and advice. Registration rules differ between the professions. Only registered professional engineers (RPEQs) may carry out professional engineering services in or for Queensland, according to the Board of Professional Engineers of Queensland. See insurance for engineers.
Written by upcover's editorial team.
This article provides general information only and does not take into account your objectives, financial situation or needs. It is not legal advice. Registration and professional indemnity requirements for architects are set by state and territory boards and legislation, vary between jurisdictions and can change, so confirm what applies with your own board. Insurance availability and cover are subject to underwriting and the terms, conditions, limits and exclusions of the relevant policy. Read the policy wording and its terms and conditions before deciding. upcover arranges insurance products with selected insurers and underwriters and does not compare all general insurers or insurance products available in the market.
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