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How Independent Reviews Help Manage Firm Exposure

The likelihood of design deliverables being released for approval or actual construction while containing negligent errors or omissions are higher than most firms would like. This is due to projects becoming more complex and design times being severely constrained. As such, more projects are involving design input from a wide range of consultants and other entities. Design fees do not always compensate for the level of service that design firms think are appropriate.

Increasingly, design firms are using independent reviewers as a way to manage firm exposure by assessing design deliverables before they become final. Having independent experts, or even just another set of experienced eyes, review the instruments of professional services appears to be reducing incidents, claims, and costs.

Independent Reviews Help Manage Firm Exposure

 

Using project peer reviews

For decades, engineering and other design firms have used peer reviews. Some have used an organizational peer review whereby outside practitioners evaluate the business operations of a firm. More design professionals, led by the long-time practice of the structural engineering discipline, are seeing the advantages of routinely using a project peer review process. Many structural engineering firms have high professional liability loss ratios. The frequency of claims and the severity of the paid claims indicate the magnitude of exposure for structural engineers.

In the past, peer reviews were often used on projects where performance was deemed to be critical or when innovative materials or techniques were being incorporated into the design. The project peer review effort provided an evaluation of design concepts to meet performance objectives. On larger and more complex projects, reviews gave design firms and their clients increased confidence in design and in design documentation through the deliverables. Now that confidence is being provided on a wider range of projects.

The effectiveness of a project peer review is that it is performed by an independent team or individual not associated with the original design team. While a separate firm often performs the review—perhaps a firm trading review services with a peer—the reviewer can also be a separate, experienced individual or studio within the same firm. Whether the review is performed internally or externally, the key is that the assessment be conducted by an entity that did not participate in the original design and is unlikely to miss some deficiency or possible problem because of time or budget constraints.

The review assesses the likelihood that the instruments of service—the deliverables—would satisfy the client’s stated objectives and would be in conformance with good professional practice. A project peer review is not meant to shift or spread exposure for professional liability claims. The goal is to provide feedback to reduce the probability of claims and to make any filed claims easier to defend.

Independent Reviews Help Manage Firm Exposure

 

Assessing constructability

A key ingredient in the recipe for the successful completion of a project is a thorough and independent constructability review. On projects where the construction team is engaged during the design phase, there is a much greater chance that the design firm and client will benefit. A structured and well-documented constructability review process provides for the timely integration of construction input into project planning, design, and field operations. Clients are better served because considerations for the fabrication, installation, operability, and maintenance are addressed by representatives of the client, those responsible for construction, and other project stakeholders.

Because a constructability review should be an interactive process, the investigation should take place throughout the design process. In many instances, however, the actual construction team may not be identified until the design is nearly complete. Still, a constructability review performed by a consultant can achieve many benefits.

As more projects are delivered through a building information model rather than through two-dimensional plans and printed specifications, the incorporation of a constructability review can be an automatic procedure in the integrated design and construction process.

Meeting the standard of care

Every project is unique, meaning that each is an exercise of professional judgment. Modifications to the instruments of service and adjustments during construction are expected. As a result, the law does not require faultless performance from a design firm, complete and error-free deliverables, or a perfect project. Design firms are not product vendors, and neither the deliverables nor the project is required to meet product liability standards. If professional services and the projects they lead to are to meet client expectations however, care has to be taken to minimize problems that could lead to disputes and claims. Using project peer reviews before deliverables are released and incorporating constructability reviews into the design process are two techniques with proven records of minimizing professional liability exposure.

 


Victor and CNA work with the AIA Trust to offer AIA members quality risk management coverage through the AIA Trust Professional Liability Insurance Program and Business Owners Program to address the challenges that architects face today and in the future. 




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