Limiting Liability for Attorneys

Professional Liability Coverage for Attorneys

There are more ways to limit your liability apart from Professional Liability Insurance, such as the following:

     • Disclosing requested information in the insurance application and
     submitting the application well before the coverage date

     • Documenting the processes used to carry out professional responsibilities

     • Committing to loss prevention and using risk management services

     • Adopting and implementing malpractice prevention measures such as
     office management policies

     • Using effective calendaring and docket control systems

     • Using well-defined fee agreements with your clients including written
     documents to confirm the attorney/client relationship

     • Using an electronic conflict of interest search system

     • Practicing in the area of law in which you have experience, and
     appropriately supervising junior attorneys and support staff

     • Using peer review as part of your quality control procedures

Some of the benefits of attempting to limit your liability include lower professional liability insurance premium increases and avoidance of nonrenewal notices.

Professional liability coverage for attorneys and law firms in today’s business climate is a necessity, and in some cases is legally required. Although the overall number of legal malpractice claims is leveling off, the number of large legal malpractice claims is sharply rising. Every malpractice insurer that was surveyed for the Lawyers’ Professional Liability Trends: 2012 study paid or participated in paying claims in excess of $50 million. Similarly, nearly all surveyed organizations saw anywhere from a 6 to 21 percent increase in the amount of claims totaling more than $500,000 in 2012.

These dramatic increases are due in part to a weakened economy in which attorneys are forced to change jobs more frequently or practice in new areas of the law. Additionally, newer methods of communicating (email, social networking sites) and using digital information (electronic filing of court records, electronic document storage) regularly expose attorneys and law firms to the potential for malpractice claims. It is imperative that attorneys and law firms recognize emerging legal malpractice risks and purchase coverage to protect against those risks.

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