Short answer
When a partner leaves an architecture firm, two separate exposures need attention: work already performed and work performed going forward. Don’t treat them as the same question. The existing firm’s policy may continue if the company keeps operating. However, the carrier still needs to know about the ownership change, and the departing partner’s historical work needs its own review.
What happens to the policy when a partner leaves an architecture firm?
If the firm keeps operating, its professional liability policy may also continue. Even so, you should notify the carrier about the ownership change.
Your broker may need several details:
- Who is leaving
- The effective date
- The new ownership percentages
- Whether the departing partner will keep practicing
- Whether the partner is taking any projects
- Whether the firm’s legal entity or name is also changing
What happens to projects the departing partner worked on?
This is where the actual policy wording matters most. A professional liability policy may define certain current and former partners, members, officers, or employees as insureds for services performed on behalf of the firm. Removing someone’s ownership interest therefore doesn’t automatically settle whether they still have protection for work performed while they were there.
Because this varies by carrier and form, review the policy language directly.
What if the departing partner starts another firm?
That creates a different exposure entirely. If the partner opens a new architecture or engineering practice, the new firm generally needs its own professional liability insurance for its new work. Don’t assume the new firm’s policy covers projects the architect worked on at the former company.
Instead, address the historical work separately. The prior firm’s policy or another arrangement designed to respond to it should handle that exposure.
Why address this before a partner leaves the architecture firm?
Talk to your broker about the change before you remove a partner from the policy or cancel any coverage. Professional liability claims can surface years after the underlying work, so the timing of a departure doesn’t reduce that exposure.
The goal is to understand three things: who actually performed the historical work, which entity performed it, and which insurance arrangement should respond if a claim arises later.
Example
A founding partner leaves a five-person architecture firm to start an independent practice. The existing firm continues operating under the same name and entity, and the departing partner takes no active projects along.
The remaining firm notifies its broker of the ownership change so the carrier can update the current policy. Separately, the firm and the departing partner need to understand how the policy would treat the partner’s earlier work if a claim arose from one of those projects. The new practice also needs its own policy for new work. That policy won’t extend back to cover projects from the prior firm.
What to check when a partner leaves an architecture firm
- Notify your broker before removing anyone from the policy or changing ownership records.
- Confirm the effective date of the ownership change and whether the entity or name is also changing.
- Review the policy’s definition of insured to see how it treats former partners for past work.
- Confirm whether the departing partner is taking any active projects.
- If the partner starts a new firm, arrange separate coverage for that firm’s new work.
Related questions
Does my firm’s professional liability policy automatically cover a departing partner’s past work?
It depends on how the policy defines who qualifies as an insured, including former partners or employees. Review the specific wording instead of assuming coverage continues.
Does a departing partner need their own insurance at their new firm?
Generally, yes, for new work performed there. That new policy typically won’t extend back to cover projects completed at the previous firm.
Should I remove a departing partner from the policy right away?
Talk to your broker first. Since claims can arise years after the work, confirm how to handle the change before you make it.
What information does the broker need when a partner leaves?
Your broker needs to know who is leaving, the effective date, and the new ownership percentages. They also need to know whether the partner keeps practicing, whether the partner takes projects, and whether the entity or firm name is changing.
Does it matter which entity performed the historical work?
Yes. Identifying which entity performed the work, and under what insurance arrangement, is central to determining what would respond to a future claim.