Professional Solutions Insurance Company (PSIC) wrote their Attorney Malpractice Insurance using the program name Attorney Shield. Carolina Casualty Insurance Company (CCIC) purchased the book of business and for renewals starting with effective dates on or after 1/1/2020, are offering renewal terms.
If you renewed and maintained past acts coverage with CCIC or another insurer, your new insurer is now responsible for your past acts coverage. The following discussion only applies if you purchased an ERP through PSIC.
What are the impacts on my PSIC Extended Reporting Period Endorsement (ERP/Tail)?
A little background on the ERP. The PSIC Attorney Malpractice Policy is written on a claims-made form. When a firm (or attorney) is no longer practicing or no longer wants to carry an attorney malpractice insurance policy they should purchase an ERP to protect their past acts. In most cases there will be a charge. The cost can range from 1 time to over 3.5 times expiring premium.
The ERP is attached to last issued claims-made policy. The ERP extends the reporting period for claims made for covered acts under the policy. Without the ERP being issued once the claims-made policy terminates, the insurer’s obligations under the policy terminates for any newly reported matters. In other words, you lose coverage for past acts.
PSIC’s obligations for insurance coverage under the ERP were not assumed by CCIC. PSIC is an admitted licensed insurer in the states that it wrote the Attorney Shield Attorney Malpractice Insurance Policies and continues to write other lines of business in those states. Any ERP covered past acts still are reported to PSIC. The PSIC is responsible for the settling claims under the terms and conditions of the claims-made PSIC policy that was inforce at the time the ERP was issued.
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Lee Norcross, MBA, CPCU
Managing Director, CEO
(616) 940-1101 Ext. 7080