Professional liability insurance, or errors and omissions insurance, is an important piece in any legal practice. As a lawyer, you can't always just slap some legal jargon and paperwork around to get out of a lawsuit. Remember, if you get sued, you're dealing with one of your own and they are sure to have some legal maneuvers to throw at you.
An independent insurance agent is as valuable as a good attorney. They can find competitive and sufficient coverage to make sure you and your practice are properly protected. Being proactive is the key to any good fight. And in this case, having coverage for claims that come your way is a good way to be proactive.
What Is Professional Liability Insurance?
Professional liability insurance is designed to protect your law practice or firm from any negligent or misadvice given to a client. As you know, if a client has negative repercussions due in any way to your counsel, they can file a lawsuit.
Whether or not that lawsuit will stand up in court is a different story, but responding to the suit is your lawful duty and will require some legal and financial action on your part which a professional liability policy can cover.
Professional Liability Insurance for Law Firms
Law firms of all sizes need professional liability insurance. When you're dealing with clients that may not be in the best situations to begin with, you don't want to be added to their list of people to blame. The way that a law firm large or small obtains and offers professional liability insurance is as follows:
- Step 1: Contact an independent insurance agent to go over your firm's specifics such as the number of partners, attorneys, types of law your firm practices, whether there is litigation involved on a consistent basis, and what your claims history is thus far.
- Step 2: Decide on limits that the firm should have per occurrence and total policy term aggregate. The per occurrence refers to the total coverage amount per any one claim. The total policy term aggregate limit is the coverage total per multiple claims in a policy term, which is typically one year.
- Step 3: The firm will usually offer coverage to your partners and attorneys who practice under your firm's umbrella.
- Step 4: Your independent insurance agent runs the numbers with multiple insurance companies finding your firm the best rates at the coverage decided upon.
- Step 5: You decide which policy option is right for your firm and take out the policy.
One item to note, if you work at a firm and they offer professional liability coverage for your legal practice through their firm's policy, make sure you are running that by your independent insurance agent.
It's important that you have the proper coverage for yourself and not just the firm. After all, being sued can be a complicated and financially grueling situation, so it's best to be prepared.
Professional Liability Insurance for Individual Attorneys
When you are looking for an individual professional liability policy, it means you have chosen to set up shop and work for yourself. You are a solo law practice in the wild west of lawsuits and you need professional liability coverage to protect your business. Here are some next steps that you'll need to take on the road to protection:
- Step 1: Contact an independent insurance agent to go over your solo practice specifics such as type of law you practice, whether there is litigation involved on a consistent basis, and what your claims history is thus far.
- Step 2: Decide with your independent insurance agent what you want limits per occurrence and total policy aggregate to be set at.
- Step 3: Your independent insurance agent runs the numbers with multiple insurance companies finding you the best rates at the coverage decided upon.
- Step 4: You decide which policy option is right for you and your practice and take out the policy.
It's pretty easy to get covered when you have a trusted advisor on your side. There are only four easy steps to to take and you can be on your way to a better night's sleep.
What's nice about working for yourself instead of a law firm is that you get to pick and choose which coverage is right for you without adhering to another lawyer or board of directors.
Costs of Professional Liability for an Attorney
The costs of an attorney professional liability policy will depend on a few factors.
The few factors:
- Whether you're a solo law practice or a law firm
- Whether you've had a loss history or prior claims history
- How long you've been practicing
- Gross annual revenue
- The type of law you or your firm specialize in
- The types of clientele you represent
- If you are a litigation lawyer or firm
Knowing the exact pricing or even a ballpark figure is pretty impossible unless you have a crystal ball or a really precise fortune cookie. The only way to know for sure is to reach out to an independent insurance agent who can analyze the data and run the information with specific carriers that specialize in professional liability insurance.
Benefits of an Independent Insurance Agent
Fortunately, this is not one of your cases and you are not required to do all the research. Instead, you are getting your independent insurance agent to do the legwork for you. They will scour the vast land of professional liability carriers and find you the best and most reasonably priced coverage for your law practice.
Working with an independent insurance agent is the easiest way to take away the pain of wasted time and research. So go on, delegate it to a licensed professional.