Attorney Malpractice insurance policies have a Retro Active date sometimes called a Prior Acts date. But some attorney malpractice policies do not. These attorney malpractice insurance policies are Full Prior Acts (FPA). An FPA claims-made liability policy that does not contain a retroactive date will cover claims arising from covered acts back to the inception date of continuous claims made coverage for the firm.
And the difference means?
Firm with a prior acts date:
The insured has a claims-made policy that includes a January 1, 2000, retroactive date and a January 1, 2018–19, policy term. If a claim is made against the insured on February 1, 2018, and the claim arose from a wrongful act that took place on January 1, 1998, there would be no coverage under the policy. This is because the wrongful act took place prior to the January 1, 2000, retroactive date.
Firm has FPA (Full Prior Acts):
This insured has a policy term of January 1, 2018–19 but the policy contains no retroactive date. Firm has had continuous claims made coverage back to the firm’s inception. If a claim were made against the insured on February 1, 2018, from a wrongful act that took place on January 1, 1998, coverage would apply because the absence of a retroactive date or an endorsement stating FPA meaning that regardless of how far in the past that a wrongful act that gives rise to a claim took place, the claim will be covered (assuming claim is made during the policy period).
Can any firm get an FPA (Full Prior Acts) Policy?
FPA is normally written for an insured firm that already has coverage in place at the time it submits an application. Insurers rarely write FPA for insureds that have not previously purchased attorney malpractice insurance. Insurers do not want to ‘buy’ a past potential claim, by endorsing a policy FPA.