The Basics of Legal Malpractice Insurance

At some point in your career, it may happen. A disgruntled client, rightly or wrongly, may sue you for legal malpractice. It is a risk that concerns all attorneys. Even if the allegations are baseless, dealing with such a claim will consume an inordinate amount of time and possibly money. To protect against this risk, attorneys obtain legal malpractice insurance.

Jurisdictions vary on the whether they require attorneys to carry malpractice insurance, don't require it, or require a written disclosure to the client if attorneys don't carry it. Commonsense however, weighs strongly in favor of always carrying malpractice insurance, regardless of your jurisdiction's requirements.

Benefits of Maintaining Malpractice Insurance

Having a malpractice insurance policy in place:

1. Protects you against claims of professional negligence;

2. Protects your staff and associates;

3. Provides you with the peace of mind to focus on other aspects of your practice;

4. Could provide your practice with a means to outsourcing risk management;

5. Builds client confidence in your practice, thus legitimating your practice;

6. May fulfill your ethical and professional obligations; and

7. Might cover the cost of having independent legal counsel represent you in an ethical complaint.

The FindLaw Guide to Malpractice Insurance

To help attorneys deal with the many questions that may arise regarding legal malpractice insurance, FindLaw has put together The FindLaw Guide to Malpractice Insurance, a 4 page downloadable pdf.

The Guide addresses the following various questions that many attorneys have when it comes to obtaining legal malpractice insurance:

  • Why do I need insurance?
  • Is it mandatory?
  • How much is insurance and what affects the price of insurance?
  • How much coverage should I buy?
  • Where do I go to get insurance?
  • What can I do to lower the risk of malpractice claims?
  • I'm a new lawyer. Can I get insurance?
  • What do I need to know about my insurance company?
  • Can anyone help introduce me to different insurance options?
  • What do I need to tell the insurance company?

 

Are You in a High Risk Practice Area?

In the ABA's most recent study on legal malpractice claims filed against attorneys, the five practice areas that have the most filed claims are: real estate, plaintiff's personal injury, family law, estate, trusts and probate, and collection and bankruptcy. Even if your practice does not fall within one of these areas, it would be prudent to ensure that you, and your firm, are protected against this risk.

FindLaw's Guide to Malpractice Insurance will help you take the first step in learning what you need to know.

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