Lawyers Professional Liability policies do not have standard wording, but excluding the firm’s attorney’s fees is a common exclusion. Normally attorney’s fees are not considered damages or malpractice and are not covered.
When examining the Lawyers Professional Liability Policy, this exclusion is not normally found in the exclusion section of the policy. Frequently you will find this in the definition of “damages” or what is a “claim expense”. The Medmarc Lawyers Professional Liability Policy is typical of how the “exclusion” is crafted in the definitions section of the policy:
“Damages means monetary judgments, awards, or settlements, but does not include (a) the return or restitution of legal fees, costs, and expenses charged by the Insured; (b) any client funds allegedly misappropriated, whether by an Insured or any other person, and whether intentionally or not, or interest thereon; or (c) fines, sanctions, penalties, punitive damages, exemplary damages, or any award resulting from the multiplication of compensatory damages, imposed against any Insured, any client of an Insured, or any other person or entity.”
If you are being sued only for the return of attorney’s fees, you should still notify the carrier. It is important to put them on notice a later time the allegations might expand beyond just attorney’s fees. The reason for this is you could have your Lawyers Professional Liability Carrier state that you had “prior knowledge” of circumstances leading up to a claim and using this for a basis for denying a mal practice claim at a later date.