Lawyers’ Professional liability insurance policies, by their very nature are “claims made” policies. There are two critical dates we will discuss here as it relates to ensuring that the error, act or omission you made would be covered. One of the most important provisions in this type of policy deals with when a claim should be reported to the carrier. When a covered claim is first made during the policy period, this must be reported to the company during that same policy period. Think it may not turn into anything and you’ll wait and report later if it does? DON’T!  Failure to report the wrongful act, error, omission, etc. during that policy period could potentially jeopardize future coverage. Once you are made aware of a claim, bar complaint, grievance, etc. the policyholder must report immediately. Not sure if the event is reportable? Find a good agent who specializes in malpractice insurance for lawyers and ask!

Another important date an attorney should familiarize themselves with is the retroactive (or prior acts) date. The retroactive date establishes the point in time which any error, act or omission would be covered. Coverage would not be triggered if the alleged error, act or omission occurred before that time. It is important that as your lawyers professional liability policy is renewed each year, steps are taken to preserve that “retroactive date” In this day and age where an attorney may go from firm to firm, it is imperative they make sure coverage exists for any potential claims that may arise from previous legal work performed on behalf of a former firm. In most cases, the attorney would be protected from work done at a prior firm on their policy if the former firm has had continuous coverage. In the event the old firm has dissolved or closed their doors they would have an opportunity to purchase TAIL coverage.

Written by Graham Swafford