a/e ProNet is proud to sponsor the American Council of Engineering Companies (ACEC) Scholarship.  Each year this $5,000 scholarship is awarded to well-rounded engineering students.  The application deadline for 2019 submissions is March 15th, 2019.  Visit our Scholarships Page for more information and applications.

In the summer of 2018 the ACEC announced that Leah Bectel, studying for her B.S. in Environmental Engineering in her Senior year at Michigan Technological University, won the this scholarship.  Leah was kind enough to provide her ACEC National Scholarship Essay as a Guest Post, below.  This, the outlook of an engineering up-and-comer, serves both as an example of a winning scholarship essay and as a rare glance at the industry perspective of a successful engineering student building a foundation for her career.

ACEC National Scholarship Essay – 
By Leah Bectel

Consulting firms are the ultimate behind-the-scenes type of business. Most people do not think of them when they ride along a bike path, push their kids on a park swing, flush their toilet, or turn on the sink faucet. However, consultants design and implement these crucial services and so much more.

I used to imagine consulting firms as a very black and white profession. A client would call a consultant, request an engineering design, and the firm would create the design and help make it a reality.  Through working for a consulting firm, however, I have discovered this is hardly the case. Consultants are the greatest advocates for their client- in any given day a firm will become a financial adviser, helping a community stretch their limited budget to finish a project. They also become marketing specialists, gaining new clients to help the firm obtain more work. Consultants assist their clients in applying for grants, serving their best interests. Firms will then collaborate with many sub-contractors, obtain permits, and ensure they are staying within the project timeline. These tasks hardly scratch the surface of what consultants do for those around them. Each project is different and demands collaboration, new ideas, and innovative solutions.

I like to think of consulting firms as fulfilling a community’s Maslow’s Hierarchy of Needs: Infrastructure Edition. Townships and cities are some of the best clients consulting firms have, ensuring the community has adequate streetlights, roads are navigable, and water faucets are running, to name a few. Once these basic needs are met, communities can strive for amenities such as bike paths, parks. landscaping, or upgrades to existing community spaces. When families see community spaces are thriving, they notice and are attracted to the city or township. Established common spaces and  infrastructure means safer towns and a greater network of people feeding money into the local economy. Consultants advise their clients to treat their infrastructure as Maslow did for basic human needs, which in turn helps establish communities and strengthen the social fabric.

Applying Maslow’s thinking to my engineering decisions will help not only the clients I’m working for but myself as a practicing engineer. Being able to implement my engineering designs and educate the public has been my dream since high school; becoming a consulting engineer allows me to fulfill both of those missions. Last summer I worked for a consulting firm helping document Michigan communities’ water infrastructure issues through the Storm water, Asset Management, and Wastewater (SAW) Grant Program. Next summer I have committed to perform more consulting work, helping clean up contaminated soil and groundwater plagued from pollution that occurred decades ago. These experiences will serve me well in my future career in consulting.

For much of my life I have been faced with the dilemma of whether I will devote my career to helping better the environment or those around me. Through working for a consulting firm, I have discovered it is not an “‘either or” dilemma- both of my passions will be fulfilled. Once I complete my degree in environmental engineering with a minor in municipal engineering, I plan to move on to my master’s in civil engineering, becoming a well-rounded consulting engineer.

Guest Post, by John Ronan:

IIT Innovation Center by John Ronan Architects Opens

The Ed Kaplan Family Institute for Innovation and Tech Entrepreneurship at the Illinois Institute of Technology opens this month, the first new academic building at IIT in over forty years. The Kaplan Institute is devoted to fostering collaboration, innovation, and entrepreneurship between IIT’s students, faculty, alumni and partners and the building will host a variety of collaboration spaces for university’s project-based experiences, contain state-of-the art prototyping and fabrication facilities, and serve as the new home for IIT’s Institute of Design.

The horizontal, open and light-filled building is designed to encourage creative encounters between students and faculty across disciplines. Located in the heart of IIT’s historic Mies campus, the building draws students and faculty in from all directions. Conceived as a hybrid of campus space and building, the design is organized around two open-air courtyards through which visitors enter the building, and which serve as collision nodes for chance meetings and information exchange across departments. These two-story glazed courtyards bring natural light deep into the floor plate, creating a spacious, airy and light filled interior and a continuous connection with nature.

The design of the Innovation Center is innovative in its own right, and forward-thinking in its approach to sustainability. The second floor of the building, which cantilevers over the ground floor to provide sun shading, is enclosed in a dynamic façade of ETFE foil cushions which can vary the amount of solar energy entering the building through sophisticated pneumatics. The ETFE foil is 1% the weight of glass and gives the building a light, cloud-like appearance.

“It’s an idea factory—a place of creative collision between students and faculty across disciplines, where new ideas are explored and tested on their way to becoming meaningful innovations.”   —John Ronan, FAIA

For more on this project, click here.

a/e ProNet Celebrates 30th Anniversary

At our 30th anniversary dinner in Chicago, IL last Thursday night, a/e ProNet members gathered to honor our organization and the improvements our members have affected for 3 decades.  Our members reflected on why a/e ProNet was created, how far we have come, and where we are going.  We were lucky to hear a speech by Tom Coghlan, one of a/e ProNet’s five founding members, who laid out the vision that has driven a/e ProNet to hold such a significant position in the design professionals insurance marketplace.  Tom gave credit for the impetus that has led us here to the late Dave Lakamp, who’s efforts to reshape this industry continue to guide the industry still today, through our organization and the work of our members.

Here is what Tom had to say:

In 1987, a group of 5 brokers met at Lockton Brokers in Kansas City. Dave LaKamp(may he rest in peace), Grover “Brad” Simpson, Dave Shipley( may he rest in peace), Greg Kumm and I. Prior to this initial meeting Greg and I were encouraged by Lorna Parsons of Schinnerer to introduce ourselves to each other because we were all complaining about the market conditions, at the time, and the impact that was having on design professionals. The timing of this was during what had been dubbed by the media as “The Liability Crisis” that impacted virtually all aspects of society, in general and design professionals in particular. Some of you in the insurance industry then(the Mid-1980’s) will remember soaring Professional Liability Premiums, imposed Deductible increase seven for firms without losses, limited choices among insurers in the marketplace, and an inability to satisfy contractually agreed to Limits of Liability due to the lack of reinsurance and the overall angst our design professional clients were experiencing.

We discussed the following questions, among others:
Would design professionals in private practice benefit from the formation of a new network of insurance professionals, independent from the Professional Liability insurers, dedicated to providing risk and practice management initiatives, programs and services?
Could we leverage our collective knowledge, experience and individual advocacy for our design clients and improve the availability and afford ability of Professional Liability coverage?

It was decided that yes-establishing this new independent network would benefit our clients and protect them from the inconsistent and erratic behavior of the insurance industry writ large.

a/e ProNet was formed in 1988 and began to build out its membership, by invitation only, with like-minded and capable insurance brokers throughout the country. Today, we have 37 broker members and 10 associate members who are practicing attorneys who provide counsel and defense to our design professional clients. We represent some $300,000,000 in annual Professional Liability Premium in the aggregate and some 16,000 design clients. Truly a testament to a great success story of our members delivering value to our design clients!

In my opinion and experience, Dave LaKamp was the primary visionary and driver of our success. Dave LaKamp was a pioneer in the development of the discipline of design practice risk and practice management. Dave connected the “dots” among all stakeholders:

• the insurance brokerage, insurance and reinsurance communities
• the practicing design professionals
• the professional organizations including the AlA, NSPE, ACEC, both locally and nationally
• owner groups, both public and private
• and the legal defense community

I believe Dave was the most articulate, innovative and effective advocate for design practice risk management in the insurance industry during the last few decades of the 20th century. Dave was an iconoclast who’s talent and vision matched the moment. He strongly advocated an empowerment of design professionals when insurers and attorneys, and even the AlA, through their standard documents, were encouraging design professionals to attempt to limit their scope and avoid responsibilities when rendering services the project owners.

Dave believed this was a slippery slope of diminishing the value of the design professional, which would leave them with reduced standing in the design/construction process, reduced revenue for services rendered, while at the same time, ultimate legal responsibility with less control of a successful project outcome. Dave believed design professionals should negotiate as full a scope of services as possible to protect the project owner, while at the same time provide design professionals with the authority and knowledge as to what was occurring on the project in real time.

Dave was instrumental in showing Professional Liability insurers that providing pre-claim assistance to design professionals would reinforce and preserve the design professional’s relationship with the project owner, reduce the design professional’s liability and ultimately benefit the insurers. In the day- that was a pretty good trick. Well done, Dave.

Dave was also effective in encouraging the Professional Liability insurers to recognize they really didn’t need all of the legacy and newly introduced Exclusions contained in their policies. These include, but are not limited to, Exclusions for design/build, timeliness of services, cost estimating and the newly introduced absolute pollution and asbestos Exclusions. Each of these Exclusions have been eliminated from the typical coverage offerings to design practices. He believed if design professionals shied away from and stepped back from offering meaningful and valued services to the project owner others would fill the void. Ava Abramowitz, when she was at the AlA and involved in the standard document revision process used the term “assertive practice.” Not reckless. Not aggressive. Just a call for design professionals to reclaim their historical role.

Dave believed design professionals should be shoulder to shoulder with project owners as highly respected professionals enabling project owners to achieve their objectives, rather than be in the line of fire when the inevitable difficulties would surface during the course of developing the project. He believed design professionals should be relied upon to professionally respond to those
circumstances- not be blamed for them. Let’s call it turning a pigs ear into a silk purse. Once again, good job, Dave.

Dave believed professional Liability insurers should be proactive in managing risk rather than just passively defending and indemnifying claimants when warranted.

Dave LaKamp:
• didn’t accept the status quo
• had a vision of how things could be better for the design professionals he served as an insurance broker and adviser, and
• shared his knowledge, experience and talents with others to improve the discipline of design practice risk and practice management.

Today, a/e ProNet has a prominent position in the Professional Liability market place evidenced by all the insurers who choose to be here – and pay for the opportunity.  a/e Pro Net has the respect of all of the stakeholders I mentioned earlier. They rely on us to help them manage their risks. a/e ProNet has a continuing opportunity to shape the future of practicing design professionals’ financial well being.

I hope you found my story of the foundation of ale ProNet of interest so that you too would be inspired to think of ways you can contribute some things of value to your profession for those who will follow in your footsteps.

Insurance Coverage on Construction Projects

In the BrickerConstructionLaw.com Newsletter we read, “Proper insurance is a crucial risk management tool for contractors, design professionals and project owners. Each is generally required by contract, statute, or sense of self-preservation, to purchase and maintain appropriate insurance coverage. Since everyone has insurance, it is easy to assume that most risks on a construction project are covered. The purpose of this article is to correct that misapprehension, by describing the typical scope of protection offered by three forms of insurance commonly found on a construction project: Commercial Liability Insurance, Builders Risk Insurance, and Professional Liability Insurance. Of course, the exact coverage provided by an insurance policy can only be accurately assessed by reviewing the policy at issue, which can vary widely depending on the form, carrier and endorsements. It is important to review every policy benefiting your project to ensure the policy is appropriate for the project, and complies with both the contract and state law.”

For the full article, click here.

Please visit the Bricker & Eckler LLP website, here.

The economy is booming, and with it design professionals are experiencing increased demand for their services.  Subsequently, and necessarily, their risk in the marketplace is also rising.  As design firms’ see increases in their exposure, will we see a boom in insurance premiums, as well?  The ACEC 2018 PLI Survey results are in, and the implications are remarkable.

According to the ACEC publication, ENGINEERING INC., professional liability insurance premiums have remained nearly flat for the survey’s 442 respondents.  This is despite 68% of reporting member firms replying that they experienced increases in revenue in 2017.  In fact, carriers offered such attractive renewal terms, generally speaking, that 87% of respondents reported that they renewed their policies with the incumbent insurance carrier.

The data indicates that premiums were relatively unchanging for 37% of firms.  Further, it shows that the percentages of firms experiencing marked increases or decreases in their professional liability insurance premiums came in nearly half and half at 27% and 29%, respectively.  That’s flat!  It seems that the professional liability insurance marketplace is maintaining a healthy, highly competitive status.  Thus, even where increased revenues may cause inflating premiums, the rise is not dollar-for-dollar commensurate with the revenue growth causing it.  And, the answer to whether premiums are booming is a resounding “no”.

In her July/August 2018 ENGINEERING INC. article, “2018 PLI Survey Growth, Stability and Change”, Maureen Conley writes, “Firms employing good risk management practices may be much better positioned for growth,” although, as Conley is quick to point out, “risk management is especially important in the large majority of firms without in-house counsel or full-time risk managers.”  Conley highlights the number of responding firms that fall into these categories at over 90%.

a/e ProNet’s President, and Vice President of Risk Strategies Co., Michael Welbel, mentioned to Conley that, “Purchasing a PLI policy is really buying claims handling, and you do not know until you have a claim how good that service may be.”  This poses a problem for design firms that opt to purchase their insurance through non-specialist insurance brokers, or brokerages with widely varying specialties.   The fact is that not all carriers are alike, and not all a/e insurance programs are designed to fit the same needs. Using a/e specialist brokers who understand this nuanced marketplace and the unique needs of design firms is key to obtaining effective risk management.  Although, it seems that insurance premiums are stable for now, architects and engineers have an opportunity to bolster their risk management practices in preparation for future growth.

Maureen Conley’s full article, “2018 PLI Survey Growth, Stability and Change” is available on the ACEC’s website, HERE.

The results of ACEC’s 2018 Professional Liability Insurance Survey of Member Firms can be ordered HERE.

The a/e ProNet AIA David W. Lakamp Scholarship program timeline for 2018 has been revised.  The new timeline allows students to apply for this scholarship through October 5, 2018.  The 2018 Scholarships will be awarded in November for use by the winners in their spring semester.  These $5,000 scholarships are open to fourth-year undergraduates, and graduate students of architecture enrolled in an NAAB-accredited professional degree program.

The 2019 selection process for the a/e ProNet AIA David W. Lakamp Scholarship remains unchanged.

Please visit our Scholarships page for more information regarding these valuable programs.

Design professionals often come across contractual language requiring that they indemnify and defend their clients.  This has long been a sticking point in negotiations, as professional liability policies typically exclude coverage for contractual liability.  How many times has an a/e walked away from a project, because the client is insistent on this point?  How many times has an a/e signed a contract obligating them to mount a defense on behalf of their client regardless of their own negligence, or lack thereof ?  A new product has hit the marketplace in recent months, aimed at confronting this risk head on.

From the June edition of the ProNetwork News we read, “Founders Specialty, Aspen Insurance and a/e ProNet collaborated on developing a new approach. This resulted in creating a new insurance policy that works in conjunction with the typical a/e professional liability policy. Basically, the policy covers the duty to defend obligation that the a/e agreed to in their contract with the Owner. There is no deductible, but instead the policy contains a coinsurance clause that splits the costs of defense on an 80%-20% basis whereby the insurer pays 80% of the costs and the insured pays the remaining 20%. The insured’s obligation however is capped on a per claim basis. The coinsurance amount is established by the size of the firm and is approximately 1% of revenues.”

About the Author

Stephen S. van Wert Stephen S. van Wert is the President of Founders Specialty, a Managing General Agent based in Tampa, FL that specializes in the development of innovative insurance solutions for professionals. Stephen graduated with honors from Duke Law, and has held executive positions with Brown & Brown and Willis, before starting Founders Specialty in 2016.

A Fond Farewell & Thank You To Audrey Camp

For over seven years a/e ProNet had the good fortune of retaining Audrey Camp’s services.  Audrey has authored the a/e ProNet blog, hunted down outstanding content for our guest essays and whitepapers, edited the ProNetwork News, and she worked diligently behind the scenes to maintain the a/e ProNet website.

As an organization, a/e ProNet offers its members a host of industry specific content, which members can use to educate their clients about the nuances of their insurance programs and the relationship between insurance and their design trades.  Audrey has been at the forefront of a/e ProNet’s efforts to keep up with the demand for substantive writing about risk management for architects and engineers, among other topics, and her matter of fact writing has been integral to the comprehensiveness and readability of that material.

a/e ProNet found, in Audrey, a terrific asset.  Audrey came to us with necessary insurance industry experience to discern between critical and immaterial issues, the tech knowledge to provide web-maintenance services, the networking capacity to obtain content, and she happens to be a professional writer!  Audrey fit without a glitch into a complicated mold as our editor.  But, best of all, we have had, in Audrey, a person with the passion, drive and focus necessary to grow a/e ProNet’s industry presence.  Audrey’s care for this organization and its members fueled her efforts, and it shows.

Audrey may be leaving a/e ProNet, but she isn’t slowing down.  Over the last couple of years Audrey has shifted her focus onto other things, including motherhood, teaching literature at University of Oslo, and continuing her freelance writing career.  And, in 2017 Audrey was elected Chair of Democrats Abroad Norway!  Thusly, we bid Audrey Camp a fond farewell, and we thank her for her years of service to a/e ProNet and to us.

For more about Audrey, please visit her website, www.audreycamp.com