Choosing lawyers professional liability insurance is one of the most important decisions you can make for your firm. The following are some helpful tips:
1. Evaluate the whole program
Keep in mind the carrier is a very important piece, but not the only piece. You need to evaluate the entire program. Coverage and price aside are not the only consideration. Make sure to consider the insurance broker’s and insurance carrier’s track record, stability, risk control programs and long-term commitment.
2. Assess the financial stability / A.M. Best Rating
You are buying “sleep insurance”. So to be able to sleep well you need to know the insurance malpractice carriers continued ability to pay claims.
3. Consider the agent or broker’s relative experience
Is the broker or agent an insurance generalist? Or is the broker a specialist immersed in serving the lawyers malpractice insurance? What are they doing to stay involved in the legal community?
4. Look for a commitment of malpractice insurance carriers
With claims-made coverage business it’s easy for new malpractice insurance carriers to enter the marketplace. Many new carriers target specific markets to collect as much premium as possible. They’ll write business until the claims start coming in and then leave law firm high and dry.
Beyond the A.M. Best rating, research the carrier’s track record and length of time in the lawyers professional liability insurance business. Is this company going to be around when the going get tough?
What is the carrier’s claims philosophy? Do they fight to the death or do they settle without a fight. Does the carrier have specialized knowledge of attorney malpractice claims? Or, is the person handling a law firm’s’ claim a generalist handling other claims such as homeowners, personal auto or other types of malpractice claims.
5. Weigh Your Options from a Relevant Coverage Standpoint
The policy needs to fit the needs of your law firm based on your areas of practice and other relationships. Does it match up with the specific exposures you face? Does the carrier or agent offer other needed coverages such as Crime Insurance or Cyber/Data Breach Coverage?
6. Seek Out a Trusted Advisor
Even though you are concerned about the stability of the malpractice insurance carrier, the agent can be a very important component. An independent insurance agent/broker can provide addition insight as to which carrier best fits your needs and maybe it is time to change carriers. Many agents have outlasted most lawyers professional liability insurance carriers comings and goings.
7. Allow time to make your decision
Making this decision on the 11th hour of the 11th day does not always result in the best decision. It is important to take the proper time to complete all of the needed information for the application process and to make sure that the underwriter is as comfortable with you as you are with the carrier. Last minute surprises can be expensive. Surprises can cause premiums to change and coverage to be declined.