The Attorney Malpractice “Automatic’ Extended Reporting Period (60-Day AERP) is not what it seems. More than one attorney has assumed that they have 60 days past expiration to renew or get new coverage because a 60-Day AERP is part of their policy. Nothing could be further from the truth.
The purpose of the 60-Day AERP is to allow reporting of claims past the expiration date if no other coverage is purchased. The attorney malpractice insurance policy 60-day AERP provision does not extend coverage and does not provide a ‘grace’ period for renewing coverage. If your policy has this provision the only thing that the 60-Day AERP does is extend the reporting period for claims covered by the expired policy in cases where there is no other coverage. If other coverage has been purchased then this provision is null and void.
Even with the 60-Day AERP in force, if you have not renewed your coverage by the policy expiration date, there is no coverage for current acts past the policy expiration date. The extension does not allow extra time to find other coverage and maintain your prior acts coverage. Once the policy expires, there will be a gap in coverage. You likely will lose your past acts coverage.
From the AXIS Pro Lawyers Professional Liability Insurance Policy, the following is typical language for this policy provision:
1. “Automatic Extended Reporting Period. If the named insured or we do not renew this policy, or we cancel this policy for reasons other than for non-payment of premium, we will provide the named insured with an automatic, non-cancelable sixty (60) day extended reporting period. This automatic extended reporting period terminates sixty (60) day after the end of the policy period. The limits of liability applicable to claims made during the automatic extended reporting period shall be part of and not in addition to the limits of liability set forth on the Declarations.
No automatic extended reporting period shall be available if the named insured obtains another lawyers professional liability insurance policy that applies to such claim within sixty (60) days immediately following the end of the policy period.”
Don’t mistake this provision with giving you extra time to renew coverage.
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Lee Norcross, MBA, CPCU
Managing Director, CEO
(616) 940-1101 Ext. 7080