I call the process a pas de deux except here, your dance partner keeps stepping on your toes. And as your ‘partner’ in this scenario is the malpractice insurance company, they’re constantly changing the entrée on you. Also see “Is the second shoe about to drop? Lawyer’s Malpractice Insurance.”
That time of the year . . . to bend over.
Please believe me.
Say what? At this rate, every practice area will be “hazardous.” For that matter, the only other supposed “highest frequency” practice area information I know of came 25 years ago when the ABA’s National Legal Malpractice Data Center released data on 30,000 claims nationwide. “Legal malpractice claims occur with the highest frequency in a few specific areas of law: personal injury plaintiff, 25.1%, real estate 23.3%; collection and bankruptcy, 10.5%; family law 7.9%; estate, trust, probate, 7%.” See “Board Issue Paper – Professional Liability Insurance Company.”
And then turning the concept of who the customer is on its pointy little head, one foggy-headed insurance broker blissfully blogged at, “Lawyers Professional Liability Insurance – Why Does It Cost So Much?,” “The first, and I believe the most important, consideration for law firms to consider when you complete your lawyers professional liability insurance applications is the attitude brought to the process; why are you doing this?
“The application is your opportunity to tell the story of your law firm; why should an underwriter want to insure you and why should they offer you the best pricing they have available?”
Attitude? You want “attitude”? “Why should an underwriter want to insure you?” And“Why should they offer you the best pricing they have available?” Huh? Should lawyers gratefully get on all fours if an underwriter deigns to insure them? If that wasn’t so absurd, it might be laughably ridiculous.
But assuming the recession and flaccid business hasn’t forced a lawyer to go commando, i.e., “uncovered,” here are a few ‘Do’s and Don’ts’ on trolling for realistically competitive lawyer’s professional liability insurance.
1. Don’t get too comfortable by staying with one insurer. Shop early and every year. The Internet and ‘word of mouth’ are great search tools;
2. Don’t get complacent by staying with the same broker;
4. Don’t believe insurance company or broker “nonsense” about excessive claims in your jurisdiction. Each company has its own claims experience and another company may be much more competitive in the identical market. And besides, where’s the proof?;
5. Don’t disclose your current premium cost. All the applications ask. But you don’t have to tell them. Opening your kimono only leads to being taken advantage of;
6. Carefully analyze your practice areas. Make sure you accurately reflect the correct percentages on the application;
7. Make sure comparisons are “apples to apples,” e.g., insurers with the same financial ratings, coverage limits, deductibles, defense coverages, admitted vs. non-admitted companies, etc.