Interior Designer Insurance: How To Get The Right Coverage

Interior designer’s insurance has a few unique coverages specific to the interior design business that other types of business don’t have to worry about.

To protect the sustainability and profitability of your business, understanding these coverages will help you find the best protection and most competitive rates in the market.

Here’s everything you need to know…

 

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Interior Designer Insurance

When it comes to interior designers’ insurance, it’s important to first understand how insurance carriers define an interior designer.

Interior Designer Operations

Interior decorators and designers work with residential or commercial clients to plan the design of interior space, room, group of rooms, or an entire building.

The design may focus on aesthetics, functionality, or both. It may be purely decorative or include practical elements such as ergonomics. The interior decorator may determine the color, style, and location of furnishings, floor coverings, lighting, walls, wallpaper, window treatments, and woodwork.

Some assist clients with selecting paintings or other decorative artwork. Interior decorators may arrange the purchase of furnishings, materials, and accessories needed to complete the project.

Some may have significant values in storage in commercial or industrial buildings, while others function as sales representatives for suppliers. Interior decorators often need to know about construction techniques and be able to work with engineers and architects to meet local, state, and federal codes and regulations, such as those needed to properly locate stairways and exits. 

Property exposures

Interior designer property insurance may be limited to an office, but some will have storage or sales of furniture, home furnishings, and wallpaper. Electrical wiring should meet current codes for the occupancy.

Fire can occur from overheating or malfunctioning of equipment. Property in storage facilities can be damaged by fire, smoke, and water. Flammables kept on the site should be properly labeled, separated, and stored.

Storage facilities can be targeted by thieves. Appropriate security controls should be taken including an alarm system that reports directly to a central station or the police department.

Crime exposures 

Crime exposures for an interior design firm are from employee dishonesty.

Background checks, including criminal history, should be performed on all employees handling money. All ordering, billing, and disbursement should be handled as separate duties with reconciliations occurring regularly. Physical inventories and annual audits should be conducted. 

Inland marine Exposures

Inland marine exposures may include accounts receivables if the interior decorator offers credit to clients, audio and visual equipment used for presentations, computers for office use, contractors’ equipment and tools, fine arts, goods offsite, in transit or at exhibitions, salespersons’ samples, and valuable papers and records for clients’ and suppliers’ information.

There may be a bailees’ exposure if the interior decorator purchases items on behalf of a client and stores or transports goods until delivered and installed.

Clear documentation of ownership is important.

There may occasionally be an installation exposure. Decorative items and furnishings may be expensive and targets for theft. They may be highly susceptible to breakage, marring or scratching smoke, temperature change, or water damage.

Appropriate security controls should be taken including an alarm system that reports directly to a central station or the police department. Professional packers may be used to reduce the potential for breakage and theft losses while the items are in transit.

General Liability Insurance

There are two general coverages that are included in a general liability insurance policy: Premises liability and Products/Completed Operations.

Premises liability

Premises liability exposures are generally limited at the interior decorator’s office due to lack of public access. If there is a showroom or retail sales, customers may slip and fall over displays.

If the decorator acts as a general contractor and hires subcontractors on behalf of the client, the liability exposure increases. Poorly written contracts can result in liability hazards not anticipated for this classification. 

Automobile exposure 

Commercial auto insurance exposure is generally limited to driving to and from clients’ premises. If the interior decorator delivers goods, the exposure increases.

MVRs for drivers must be run on a regular basis. Random drug and alcohol testing should be conducted. Vehicles must be well maintained with records kept in a central location. 

Workers compensation exposure

Worker’s compensation insurance exposure is generally limited to an office. Workstations should be ergonomically designed to prevent repetitive motion injuries such as carpal tunnel syndrome.

If there is the delivery of goods or installation of furnishings or wallcoverings, workers can incur hernias, sprains, and strains from lifting, be injured in automobile accidents, by falling objects, cuts, falls, and awkward positions. If the interior decorator hires subcontractors, the worker’s compensation exposure increases unless all subcontractors carry their own insurance. 

Professional Liability Exposure

The last coverage that every interior design firm must consider is professional liability insurance (a.k.a. Errors and Omissions coverage).

Anytime you use your expertise or your design plans, this activity and the associated exposures are not covered under commercial general liability.

In these scenarios, you are using your professional experience and professional expertise. Any claims related to those types of interactions with your customers or any types of decisions made or any part of your product that spurs out of your expertise or your experience is going to be professional liability insurance exposure.

The Rub

Too often these coverages are not fully explained to interior designers when they’re purchasing commercial insurance.

That’s what we do here at Rogue Risk, transparent communication.

The key to getting the most competitive rate is working with an agent or brokerage who understands the market. A broker who knows the insurance companies that want to write with interior designers and is able to get you the most competitive rate for your business.

We work with contractors and business professionals to help them get the insurance coverage they need on their own terms at a price they can afford, making sure they’re properly covered, and explaining everything along the way.

That is why we focus on making sure that you have the best insurance program possible for YOUR business.

If this is the kind of relationship that you would like with your insurance provider, we would love to talk to you.

I look forward to introducing you to a new way of viewing your insurance program.

Thank you,

Ryan Hanley

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