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What projects result in the most claims against design professionals?

Most of you have probably already guessed the answer to this question. From 2004 – 2013, residential projects (houses/townhouses, condominiums, and apartments) resulted in 31% of all claims filed in the Schinnerer professional liability program (frequency rate). Residential projects also had a high severity factor (dollars paid by CNA). The average indemnity payment was just … Continue reading

U.S. Institute for Building Documentation releases new standards for as-built documentation

The U.S. Institute for Building Documentation has released new standards for specifying contracts for as-built building-measurement capture. The documents were developed to complement the already-existing standards specifying 3D building-information-modeling level of development. These new standards enable owners and clients to have assurance that constructors are building with some level of accuracy. A user guide is … Continue reading

Do you want to take responsibility for construction?

Design professionals and contractors have very different temperaments. Generally, the contractor is willing to take on more business risk; the uncertainties of the construction process foist more risk on the constructor. Constructors generally have higher profit margins. Design firms on the other hand are service providers; generally there is lower risk as a service provider … Continue reading

The planning fallacy

As risk managers we exhort design professionals to plan their projects properly, allocating enough time and resources to complete the project. If it were only that simple. Social scientists have shown that our capability to predict how much time it will take to complete a future task is often overly optimistic. It turns out that … Continue reading

Design firms need to be realistic about projects in Cuba

On December 17th President Obama announced a new approach to U.S.–Cuba diplomatic relations. Many design firms well aware of the need to upgrade the island’s infrastructure, hospitality, and housing are anxious to tap the market, either through lucrative aid contracts or by working with the many U.S. commercial entities that have been planning financial investments … Continue reading

Change requests

Your clients often want the certainty of a fixed price arrangement. Fixed price arrangements work well when there is little ambiguity in the scope of services and the functionality of the finished project. If the client team has clearly identified their needs and they are set in stone for the duration of the project then … Continue reading