The reality of attorney malpractice insurance policies is paying the deductible when a claim is made against the law firm. For an additional premium Insurers may offer for 1st dollar defense which addresses claims expenses for claims with no indemnity payment made or an aggregate deductible for multiple claims brought in any one policy year. But insurers may also have features built into their policies that reduce your deductible obligation. Valuable policy features mean that there are more than policy premiums that should be compared prior to making an insurer coverage decision. As every law firm is unique, policy features important to one insured are not important to another insured.
Retention (Deductible) reducing features with the Westfield Specialty policy are:
II. DEFENSE, SETTLEMENT, EXHAUSTION OF LIMITS, AND ALLOCATION
C. Early Settlement
If the Insurer and the Named Insured agree to the final settlement of a Claim with the claimant within ninety (90) days of the date such Claim is first made, during the initial voluntary mediation of that Claim, or within thirty (30) days after participation in such mediation, the Retention applicable to such Claim will be reduced by fifty (50%) percent, subject to a maximum reduction of $25,000. Payments applicable to the Retention made by the Named Insured prior to the application of such reduction will be reimbursed within thirty (30) days of the resolution of the Claim. This reduction does not apply to any Claim resolved through voluntary or involuntary arbitration.
V. LIMITS OF LIABILITY AND RETENTION
B. Retention
(3) No Retention shall apply to any Disciplinary Proceeding, Crisis Event, Potential Claim, or subpoena for which the Insured seeks coverage under Section I.E.
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This blog is an excerpt from the policy. The complete policy along with applicable endorsements could impact the information provided above.
Lee Norcross, MBA, CPCU, CPIA
Managing Director, CEO
(616) 940-1101 Ext. 7080