Short Answer
Professional liability insurance cost for a very small architecture firm may start near the insurer's minimum premium rather than being calculated as a simple percentage of revenue. In one recent conversation with a new architect, we discussed budgeting roughly $1,500 to $2,500 as a starting range for her specific situation. Actual premiums vary by firm, services, projects, location, limits, claims history, and insurer, so this range shouldn't be treated as a universal quote.
Why making very little money doesn't mean a very small premium
New architecture firms are often surprised that a low-revenue practice doesn't automatically get a low-cost policy. A firm expecting $10,000 in annual billings can still receive a quote around $1,500 or $2,000, which feels disproportionate against that revenue. The reason usually comes down to how insurers price small accounts, not a mistake in the quote.
What a minimum premium is
A minimum premium is the insurer's starting price for issuing the policy at all. If an insurer's minimum premium is $1,500, telling them you have almost no revenue doesn't necessarily reduce the price below that floor. The carrier has already reached the lowest amount it's willing to charge.
This is why a firm with $10,000 in billings and another small firm with meaningfully higher billings can end up with premiums closer together than expected. Revenue still matters, but a minimum premium has an outsized effect on the smallest firms.
Why premium isn't just a percentage of revenue
Revenue helps an underwriter understand the scale of a firm's professional services, but it isn't the only factor. Underwriting can also weigh professional disciplines, project types, claims history, years in business, prior insurance, desired limits and deductible, geographic exposure, contractual practices, and firm experience. Two architecture firms with identical revenue aren't necessarily identical risks.
Why a small fee doesn't mean small exposure
Your fee and the value of the project you're designing aren't the same number. An architect earning $10,000 for a residential project, or charging just $700 for a modification, can still be connected to a structure worth far more than that fee. If a client later alleges a professional error caused expensive rework or another loss, the claim isn't necessarily capped at what you charged. That's part of why insurers don't treat a small fee as automatically meaning a small potential claim.
Is $1,500 the standard minimum for architects
No. There's no single universal minimum premium across every architecture firm or carrier. The figures above came from one conversation involving a very small, new practice, and shouldn't be read as a guaranteed quote. Pricing depends on the applicant and the market, which is also why a generic number found online shouldn't drive your budgeting.
Why you might find a cheaper quote elsewhere
A lower quote elsewhere may reflect a different insurer, policy form, coverage structure, limit, deductible, or underwriting program. Price matters, especially when your practice only generates $10,000 or $20,000 a year, but it should be compared against the actual policy terms rather than the number alone. Worth asking for any quote: what professional services are covered, what the deductible is, how defense costs are treated, what the retroactive date is, whether project-type restrictions apply, what the limits are, and whether the carrier offers A&E-specific risk-management or contract-review resources.
When buying insurance makes financial sense
This is ultimately a business decision. If your side practice makes $10,000 a year and insurance costs $1,500 or more, that expense is significant, and it's worth knowing before you take the work. Weigh project revenue against insurance, licensing, software, taxes, contract or legal costs, and other operating expenses, then consider the professional exposure you're accepting for whatever profit remains. The better question often isn't whether you can find a $300 policy. It's whether the project makes sense at that fee once insurance is factored in.
Will a brand-new or very small firm even get coverage
Being small or new doesn't automatically make you too small for professional liability insurance. Small and part-time design practices can generally get coverage, subject to underwriting. Be ready to explain what you do, what you're designing, your projected billings, your experience, where you work, whether projects have already started, and your desired limits. For a brand-new firm, projected revenue and the nature of the work are often the most important pieces of the underwriting picture.
Example
A new architect expects $10,000 in annual billings from a side practice and requests a professional liability quote. The quote comes back around $1,500 to $2,000, which looks high against her expected revenue.
The reason isn't that the insurer misjudged her business. It reflects the carrier's minimum premium along with underwriting factors beyond revenue alone, such as the project type and the value of what's being built from her designs. A firm in this position should compare quotes on actual policy terms, not assume the number will fall as billings shrink.
What to check before you budget for coverage
- Ask each insurer whether a minimum premium applies and what it is
- Share your projected billings, project types, and experience accurately during underwriting
- Compare deductible, retroactive date, and defense cost treatment across quotes, not just price
- Confirm whether project-type restrictions or exclusions apply to your work
- Weigh the premium against project revenue and other operating costs before taking on work
Related Questions
Why is my professional liability premium so high compared to my revenue?
This often comes down to the insurer's minimum premium, which doesn't scale down proportionally with very low revenue. Other underwriting factors also play a role.
Is there a standard minimum premium for architecture firms?
No. Minimum premiums vary by carrier and program, so a figure discussed for one firm shouldn't be treated as universal.
Does a small fee mean a small insurance requirement?
Not necessarily. The value of what's being built from your design can be much higher than your fee, which is part of what underwriters consider.
Can a new architecture firm get professional liability insurance?
Generally yes, subject to underwriting. Projected billings, project types, and experience are typically part of that review for a new firm.
Should I choose the cheapest professional liability quote available?
Not automatically. Compare the actual coverage, deductible, defense cost treatment, and exclusions before deciding, since a lower price can come with narrower terms.
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Read MoreAuthor:
Hardcover Editorial Team
Reviewed by:
Hardcover Insurance Team
Last reviewed:
September 28, 2026
This article is educational and does not provide legal advice or determine whether a specific claim is covered. Policy terms, exclusions, underwriting requirements, and applicable law vary. Consult your insurance professional and qualified legal counsel regarding your circumstances.