General Star Attorney Malpractice Insurance Policy – Disciplinary Coverage
More than a few attorneys forget to take advantage of Disciplinary Coverage until it is too late. Attorney Malpractice Insurance policies that offer this coverage can be ‘Duty to Defend’ or ‘Reimbursement’. Even though the General Star policy’s malpractice coverage is ‘Duty to Defend’, the disciplinary coverage is ‘Reimbursement’. Insurer’s wording for disciplinary coverage and reporting differs by carrier. The disciplinary reimbursement is not subject to the policy deductible.
II. EXTENSIONS
A. If, during the Policy Period, a Disciplinary Proceeding is made against an Insured by reason of a Wrongful Act fully occurring on or after the Retroactive Date and such Disciplinary Proceeding is reported to the Insurer as soon as practicable during the Policy Period or within 60 days thereafter, the Insurer shall indemnify the Insured for reasonable fees, costs and expenses, paid to third parties other than an Insured, in responding to such Disciplinary Proceeding. The maximum amount payable by the Insurer pursuant to this paragraph A shall not exceed $25,000 for each Disciplinary Proceeding up to a maximum aggregate amount of $100,000 per Policy Period. The Insurer shall have neither the right nor the duty to defend a Disciplinary Proceeding. The Insurer shall not be obligated to pay any award, penalty, sanction, cost or order of restitution resulting from any Disciplinary Proceeding.
III. DEFINITIONS
G. Disciplinary Proceeding means any proceeding by a regulatory or disciplinary official or agency against an Insured to investigate actual or alleged professional misconduct in rendering or failing to render Professional Services.
O. Professional Services mean only those services rendered by an Insured in the following capacities:
1. lawyer;
2. law clerk, paralegal, legal secretary or other legal support staff;
3. arbitrator, mediator, lobbyist, notary public, title insurance agent, or as a member, director, or officer of any Bar Association, its governing board or any of its committees;
4. administrator, conservator, executor, guardian, receiver, trustee or in a similar fiduciary capacity, if such services are directly connected with the Insured’s practice of law; or
5. publication or presentation of research papers or similar materials related to the practice of law but only if the total fee generated from such publication or presentation does not exceed $25,000.
In all events, coverage as is afforded with respect to Professional Services shall only apply for services performed by an Insured for remuneration inuring to the benefit of the Named Insured or Predecessor Firm, or on a pro bono basis, if, prior to the performance of such services, a partner, director or officer of the Named Insured or Predecessor Firm approved of such services without a fee.
Not taking advantage of this policy coverage does not make sense. Firms have a fear that reporting disciplinary complaints can impact their attorney malpractice insurance premiums. While too many disciplinary reported complaints that do not result in an issue can cause problems. Not reporting issues that may lead to a proceeding may impact your malpractice insurance should the same issue turn into a malpractice claim at a later date. The other issue is that once a year you may need to attest on the renewal application that there are no disciplinary issues.
Click the blog tag Disciplinary Coverage by Insurer to see coverage differences
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Lee Norcross, MBA, CPCU
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L Squared Insurance Agency, LLC ® DBA in California as L2 L Squared Insurance Agency, License # 0L93416
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