When Insurance Fails You

In purchasing a professional liability policy, a firm is counting on a broader financial entity – an insurance company – to absorb all or a portion of the cost of claims and litigation in exchange for premiums paid.

There are a number of articles from AIATrust regarding risk management and how to respond if a claim arises.  However, there are few mentions of what to do if your insurer denies your tender of a claim.

“Why would my insurer deny a claim? Isn’t that the whole reason I pay premiums – for coverage?” You ask.

Let’s presume you purchased your first policy from Company A in 2009.  You renewed your policy faithfully in 2010, 2011, and 2012.  Then you switched to Company B in 2013.  In the middle of that year, you received a letter from an attorney putting you “on notice” of a claim against you from a project you had designed back in 2009.  You send it you your agent – but the carrier comes back with a denial of coverage. What happened?

There are differing insurance policies.  In some, coverage is triggered based on the date the claim is made.  In others, coverage is triggered based on the date of the “occurrence”.  And some have their own unique language.

In the scenario above, the policy provides:

We will pay for damages and claim expense for any covered claim against you alleging a negligent act, error, or omission in your professional services performed on or after the policy date, provided the claim is first made against you during the policy period.

In other words, the work and claim must be presented during the same policy period to trigger coverage (under this policy).  If you did not purchase optional extended coverage from Company A or Company B – you may be left high and dry when you needed insurance the most.

If you have received an initial denial from your insurance carrier, follow these three steps:

  1. Do not panic.  Your request for coverage is not a one-bite-at-the-apple proposition.  The notice of claim may not contain sufficient facts (or urgency) to trigger coverage in the eyes of the initial reviewer.
  2. Stay involved. Do not ignore the claim, your client, or opposing counsel.  Briefly tell them coverage has been denied and you need more time to find personal counsel and respond to the claim.  You can still be proactive by participating in inspections, assembling your documents, and communicating with your client and sub consultants.
  3. Contact your legal counsel. Experienced litigation counsel can not only assist you in preparing for and defending the claim against you but will have knowledge of insurance coverage. Counsel will write a demand letter to your carrier using the “legalease” often necessary to encourage your insurer to take a more serious look at the claim and coverage.
  4. Consider your options.  An insurance policy is a juicy target for claimants.  You may have been sued even if you did nothing wrong; but that does not mean the lack of insurance will make the claim disappear.  If the carrier continues to deny coverage, you should consider whether there is an opportunity to repair the claimed defect or settle the claim out of your own pocket before you incur significant costs and attorney fees defending a matter on principle.  It is a bitter pill to settle for nuisance value, but it is a reality of doing business.  Even your insurance carrier would balance the cost of defending a claim against settlement opportunities.  There is little point in spending $50,000.00 in attorney fees (not to mention the value of your time) for victory in court when you could have ended the litigation for $20,000.00.

If your professional liability insurance was purchased from a “set it and forget it” frame of mind, dust off your policy documents and review your coverage.  If you have – or will – switch carriers during your firm’s operation it is imperative that you compare the old and new policies with an eye toward coverage gaps.

 

Casey Quillen’s firm is a member of the AIATrust Legal Network providing full legal service to design professionals throughout Colorado.  Ruebel & Quillen, LLC now has an office in Steamboat Springs, CO to better serve firms West of the Continental Divide.

 

Inclusive Growth

By definition, gentrification is the buying and renovation of houses and stores in deteriorated urban neighborhoods by upper and middle-income people, which ultimately improves property values but displaces low-income families and small businesses.

As architects, planners and urban designers we often struggle with the idea of gentrification. Specifically, in Denver, we are often attracted to the eccentric neighborhoods that exist because of the diversity of families, lifestyles, cultures and businesses. This in turn attracts many people to those neighborhoods; therefore, becoming more attractive places to develop and build new homes, apartments and businesses. What we may often forget or deliberately choose to forget, is that when we develop these neighborhoods with the uses that stimulate the economy, we are displacing families and businesses because of the rise in property values, residential rents and commercial rents.

The question then remains; how do we create economic opportunity in our neighborhoods while remaining inclusive?

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This week, the Downtown Denver Partnership hosted their annual CityBuild event “CollaborEAT”. For one night, the CityBuild team activates a space in the city to demonstrate how activity can influence our urban spaces. This year, they turned a surface parking lot between 26th and 27th on Larimer into a four-course dining room. The event featured speakers from the RiNo Community to talk about the very issues of inclusive growth. As an Art District, RiNo’s mission is to smartly grow the district, but maintain the quality, culture and artists within the District. As you can imagine, this hasn’t been an easy task. There have been a lot of partners involved in the development of RiNo as it is today.

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It can be argued that RiNo is not affordable. Part of the CollaborEAT event was sitting and mingling with strangers, discussing how we preserve art in our communities, while also strengthening it. One of our table mates described how her boyfriend had been pushed out of his current RiNo location and priced out of other options within the District.

As our communities continue to evolve, develop and grow, we need to find strategies that allow for inclusive growth. Often development occurs to stimulate economic growth in an area. How can we advocate for inclusive economic growth?

Just this morning I read an article by CEOs for Cities about the role of Economic Development Organizations (EDOs) in Inclusive Growth. This article underlines a different aspect of inclusive growth in communities: jobs. It argues that sustainable communities and inclusive ones exist when communities invest in job creation, job preparation, and job access. The article also outlines three major strategies for ensuring and achieving inclusive growth. These strategies being:

  1. EDOs have a vital role to play in achieving inclusive growth.
  2. Inclusive growth is not an add-on to business as usual.
  3. Inclusive growth requires a good ground game.

I feel there are contrasting strategies that can be employed to ensure that the neighborhoods we love, maintain the people, character and culture that exists within them today. First, as residents, activists and artists, we must work together to support strategies and policies that work towards this goal. Second, business owners and Economic Development Organizations need to work together to provide opportunities and jobs so that residents can stay within these communities.

It seems the bottom line is, there is no one strategy to mitigate gentrification. But if we all work together to improve our communities, we might just be able to strengthen the aspects of it that we love.

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Ten things architects and engineers should know about P3s

Schinnerer Risk Management Blog

Hand Writing Old Way  and new Way(1) Nomenclature: When you hear “P3” or “PPP” or “public-private partnerships,” substitute “design-build-finance-operate-maintain project delivery.” It’s been used for decades in other parts of the world to deliver public infrastructure (horizontal and vertical) and now governmental entities (federal, state, and local) in the United States have developed a strong interest in institutionalizing this as a new project delivery method to deliver public infrastructure.

(2) New Laws: To gain traction in the U.S. and minimize the political risks for investors, comprehensive enabling legislation has either passed or is being considered across the country. As a design professional, you have a vested interest in influencing how these laws are written and how your services will be procured. You can view a comprehensive webinar on the legislative landscape. Contact your state professional association to explore ways for you (and your profession) to get involved.

(3) New Stand-Alone P3 Agencies are…

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Disruption: Architecture 2.0

As seen in AIA YAF CONNECTION 14.04


Disruption is all around us. We have recently seen it in the likes of the transportation industry, the energy market, and our politics.  Historically, major disruptions have transformed how we live and how our cities work. The invention of the car in the 1800s, for example, changed the course of urban planning that has continued to this day.  The content delivery of books, a foundation of our society, have been revolutionized to be predominantly digital in nature.  And environmental concerns related to climate change have altered how we harvest our energy.  These examples have given rise to new industries and advanced technologies, but have also caused casualties to those who didn’t adapt.  For example, as US policy shifts away from pollution heavy coal burning, the mining industry has been burned.  Where does the miner, who has specialized skills, go?  This situation can be applied to our own industry as well.  If we disrupt the profession of architecture, what does that mean for the workplace and types of employment? Will people lose their jobs? Will technology replace us?

We live in a world where data is accessible, can be gathered by almost everyone and is being used to help others prosper. Take 2016 Pritzker laureate Alejandro Aravena for example. His firm, Elemental, released four social housing designs for public use. Aravena suggested he released his designs because “we need to work together to tackle the challenge of rapid migration” (ArchDaily, 5 April 2016). This release of design into an open forum could be seen as a disruption to the profession as we have known it. The benefit of sharing data and design lies in the ability for us to gather what has worked successfully, humanize it and strengthen the relationship our users have to the buildings.

Over the past few months, the National Associates Committee and the Young Architects Forum have analyzed and gathered data on what the disruptions might be for the architecture industry.  And

this isn’t the only disruption we will see. As a profession, we need to be open to more. We need all architects to think about disruption differently. Disruption isn’t going to take our jobs away. It is going to create opportunity for new jobs. Technology has its downfalls but also has the ability to allow for the freedom to use our talents the way we want to use them. Technology allows us to create a kit of parts and use these components to think through boundless design options and new thought.

Change is inevitable and often scary. But if our firms can learn to be nimble and agile, we have exponential potential to create environments that are best for our communities. Whatever it is, I will be ready to embrace Architecture 2.0.

Beth’s Farewell Blog Post for the AIA Colorado EP Blog; Reflections on my on-going experience as an “Emerging” Professional

According to the American Institute of Architects, an emerging professional is someone “considered to be intern architects aspiring towards licensure, as well as those who have been licensed for 10 years or less.”

Recently, on a call for another publication with which I’m involved, a contributor informed our team “technically I am no longer an emerging professional…” and announced his plans to roll off our committee in the coming months.  What might be considered “unique” about this conversation is that this individual was in his early 40’s, had over 15+ years of experience ranging from intern to licensed professional to firm leader, as well as a myriad of other “adult-like responsibilities.”   His omission and decision to mark a clear departure from emerging professional status seemed fair, and frankly, overdue.

After the call, I found myself once again revisiting a question that seems to remain ambiguous and unresolved: when, in architecture, are we no longer an “emerging professional?”  When are we just a “professional,” that could strike out on our own, or lead, or feel content in our grasp of architectural skill and knowledge?

There are many milestones in life that mark when we transition from one life stage or level of seniority to another.  From graduation to moving into a first apartment, jumpstarting a career, and achieving financial independence, many life milestones serve as small and large measuring sticks for personal self-evolution.  In my own life, I distinctly remember the day I bought a “real” couch (I defined this as a furniture item that was not a futon or snagged from Goodwill or Craigslist) to mark a personal milestone of perceived “adulthood.”

Architecture, while seemingly marked with milestones (completion of internship, licensure, promotion, etc.) is a profession in which personal advancement seems to be measured by the acquisition of individual experience and a sense of self-awareness and progress, rather than a universal checklist of skills and accomplishments that lend themselves towards a sense of prescribed seniority.

This may be attributed to the concept that architecture typically demands a lot of in-put before one starts receiving tangible “output” in the form of two-pronged advancement.  The first prong lends itself to the acquisition of relevant technical and design knowledge.  This can vary highly from person to person in terms of how project experience is acquired and what its outcomes are.  For example, someone might work on a large-scale project for the first few years of their career, participating in each phase.  Others might work on a series of short, quick projects in which their contributions and learning experiences focus on a specific aspect of the trade.

The second form of “tangible advancement” could relate to leadership and, quite frankly, the often long-term process of building towards compensation opportunities that transcend a mediocre payscale in comparison to known hours of demonstrated effort and work.  This issue is larger than the individual, and is being looked at in different ways as the architectural profession continues to work to redefine both its public perception and economic value to clients and society alike.

When I started blogging for the AIA Colorado Emerging Professional’s Blog almost four years ago, I was  a fairly new transplant to Denver via Chicago.  At the time I was still pursuing IDP hours, and had not even begun to take me ARE’s.  As my career evolved in chorus with natural timelines, being able to put pen to digital paper regarding my experiences as a young architect felt just as important as the design work I was doing, and this continues to be true.

This blog has been a resource for me to discuss a wide range of experiences that range from profession to place to personal thought and forum.  From “leaning in” to exploring “The Ego and the Architect” to exploring what it means to be an extroverted introvert, to covering the many important events and resources for young architecture professionals in the Denver community, each post has been a rewarding opportunity to distill experience and opportunity into a public format that is now hopefully part of a larger shared dialogue.

A little over a year post-licensure, I can still say that I am an emerging professional.  From waterproofing to work authorizations, the peg board of gaps in my knowledge looks light a light bright waiting to be fully-illuminated, but a large enough surface area that I know I have to pace myself.

With that said, I’ve decided in the spirit of adapting to all of life’s change and milestones, to pass the torch to younger professionals’ with more early-career stories to tell and lessons to be learned.  Thank you for your time, readership, and dialogue, and please keep reading the blog for important and relevant messages from our peers, co-workers, and contemporaries.

Cheers, Beth