Construction contracts are not professional services contracts, and confusing the two creates uninsured risk for AEC firms.
In architecture, engineering, surveying, and other AEC design disciplines, firms are frequently asked to sign contracts written for construction contractors. These agreements are often described as “standard,” but they routinely allocate risk in ways that professional liability insurance was never intended to cover.
The distinction matters.
Contractors are typically responsible for means and methods, construction safety, and delivering a finished product. Design professionals are responsible for performing services consistent with the applicable professional standard of care, not guaranteeing outcomes.
Industry-standard forms, including those published by AIA and EJCDC, are explicit on this point: professional services are judged by ordinary skill and care exercised under similar circumstances, and warranties or guarantees are expressly disclaimed. That framework aligns with how professional liability policies actually respond to claims.
Problems arise when professional services agreements import contractor-style concepts, such as:
- Guarantees of results or “fitness for purpose”
- Cost-of-correction obligations that function like repair warranties
- Broad indemnity language untethered from fault
- Duties to defend or assumptions of site-wide safety responsibility
Professional liability insurance generally responds to negligence, not to contractual promises that elevate the standard of care or impose strict or result-based liability. When those promises appear in a contract, firms may unknowingly accept obligations that are partially insured or not insured at all.
This is not about avoiding responsibility or lowering expectations. Most architects, engineers, and surveyors are fully willing to stand behind the quality of their work. The professional standard of care is not a loophole. It is the recognized, insurable benchmark for professional accountability.
The real goal is alignment: contractual risk should match insurable risk. When it does, disputes are clearer, coverage works as intended, and unpleasant surprises are less likely for everyone on the project team.
Importantly, owners and clients benefit as well. When professional obligations are properly structured and insured, there is real financial backing behind those commitments. An uninsured promise helps no one when something goes wrong.
At Prairie Engineers, this alignment is something we deal with regularly. We see firsthand how well-intended contract language can create unintended risk when professional services are treated like construction services. Our focus is not on resisting accountability, but on ensuring that responsibility is structured in a way that is fair, insurable, and consistent with how design professionals actually practice.
Practical advice for AEC professionals
If you encounter contractor-style language in a professional services agreement:
- Ask why the language is needed and what specific risk it is meant to address.
- Request that the discussion include legal counsel or risk management.
- Frame concerns around insurability, not preference.
- Propose industry-standard alternatives rather than blanket deletions.
- Involve your insurance broker or carrier early. They see these issues every day.
A contract that looks “protective” on paper but is uninsured in practice protects no one.
For AEC firms, understanding the difference between contractor risk and professional services risk isn’t academic. It is fundamental to staying insurable, sustainable, and in business.
And one important note: I am a lawyer, but I am not your lawyer. This article is for general informational purposes only. Always consult your own legal counsel and insurance professionals regarding your specific contracts and coverage.
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Tristan Harper is Prairie Engineers' General Counsel and Mapping Discipline Lead. Connect with him on LinkedIn. |