From Risk to Profit Benchmarking and Claims Studies

Per-Claim Limits of Engineering Firms: April 2020

In the final analysis of your firm, the deductibles and limits your firm decides upon is a decision based on many factors. Each firm is different and each firm’s attitude toward risk is different; there is no magic number or formula. Firms must decide for themselves what is prudent for them.

60%

50%

40%

30%

20%

10%

0%

$100

$500

$5,000

$250

$1,000

$2,000

$3,000

Limits in $1,000s

Smaller firms = annual billings $5 million and below Larger firms = annual billings over $5 million

Percentage of Deductibles to Gross Billings for Engineering Firms

Firms should consider if the clients they provide professional services to and certain projects are riskier than others. Does the firm have adequate capacity and experience to provide professional services for these clients and projects? How a firm answers these questions will help determine a firm’s appetite for risk and, therefore, what deductible and policy limits may be appropriate.

1.5%

1.2%

.9%

.6%

.3%

0%

2010

2012

2016

2011

2013

2014

2015

2017

2018

2019

36 • From Risk to Profit - Benchmarking and Claims Studies

Victor

Made with FlippingBook Publishing Software