More than 5% of all attorneys currently operating in the U.S. are likely to face an allegation of malpractice of some sort in the commission of their duties. Claims against attorneys have steadily increased in the last twenty years, a pattern with no potential end in sight. Lawyers in all areas of practice, in all parts of the country, are at risk every year.
Dealing with a professional liability claim is usually quite expensive. Even if ultimately cleared, the hours of time devoted to addressing the claim, the resulting anxiety of the situation, along with the money spent on defense can be a very costly proposition. Attorney professional liability insurance helps to ease that burden by sharing some of the monetary risk as well as by assuming much of the responsibility for responding to, and defending against a claim.
Some common causes of professional liability claims
Lawyer malpractice claims are varied; probably the most common claims brought against lawyers are those alleging simple mistakes, including administrative errors or substantive errors of law. Claims alleging that a lawyer completely and improperly abandoned a representation also occur rather frequently, as are claims that an attorney entirely failed to address their client’s needs in any way.
Lawyers increasingly face lawsuits in which the primary or sole allegation is one of breach of fiduciary duty, often because of a conflict of interest, and can be difficult to defend. In addition, claims are also made as a result of fees charged to clients, as well as the occasional claim brought by non-clients.
Risks typically covered by lawyers’ professional liability insurance
Legal malpractice policies are designed to provide coverage for claims that arise from “wrongful acts” committed in the rendering of legal or professional services in the capacity of operating as a lawyer and generally provide both, indemnification coverage and claims expense coverage, subject to specified deductibles and endorsements. In general, covered acts usually also include those committed in a variety of ancillary services many lawyers regularly provided to their clients in addition to their regular services, such as:
- Services as a notary public
- Operating as a title agent and or title agency
- Acting as a trustee or executor of an estate, or
- Acting as an officer or director of a legal professional association
In addition to attorney professional liability insurance, broader coverage can often be added through an amendment of various endorsements depending upon the lawyer’s needs and the carrier’s capacity. Speak to an agent regarding any questions or concerns.