Attorney Malpractice Insurance provides protection for an attorney’s assets. A malpractice judgement might not only impact current assets but future earnings. In our current litigious world, it is rare that an attorney goes through their entire career without a claim made against them and in trouble times, claim frequency rises. Remember it is not just a judgement but the defense expenses that can cost you. Even if the attorney wins a malpractice case that goes to trial the average cost of defense is now over $70,000.
Attorney malpractice insurance premiums vary widely. No two attorneys are going to pay the same amount for their coverage. Attorney malpractice insurance is written for the law firm entity. The premium is on a per attorney basis. The key rate factors are:
1. Number of Attorneys and how long they have been with the firm.
2. Claims History
3. Disciplinary History
4. Areas of Practice
5. Number of years with continuous claims made coverage.
6. Liability Limits
7. Deductible Options
Premiums for different areas of practice can be 5 to 10 times from one area of practice to another. Criminal law and insurance defense firm generally have the lowest premiums. Securities Placement, Class Action Work, and Intellectual Property tend to be on the higher end of premiums paid.
Premiums for an attorney without insurance coverage can start out for as little as $300 to $500 for the 1st year of coverage. Expect premiums to rise over the first 5 to 8 years until the attorney is fully-rated. The average premium for most fully-rated claims free attorneys should be between $1200 to $2500 per year depending upon limits. The per attorney premiums for firms in the higher risk areas can be around $3000 to $10,000. These premiums vary widely by state and location in the state based on the malpractice insurer’s past claims experience in that area. Premiums also vary by insurer. In some cases, premium differences by insurer can be over 50%.
For attorneys, this cost is small versus the risk to one’s assets. Attorney Malpractice Insurance is Sleep Insurance. What is it worth to sleep well at night?
If interested in a premium quotation CLICK HERE.
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Lee Norcross, MBA, CPCU
Managing Director, CEO
(616) 940-1101 Ext. 7080