Lawyers Need Professional Liability Insurance Too

When you're an attorney, clients trust you to protect their legal interests. In granting that trust, they can sometimes set expectations that might be impossible to meet. If a client feels angry enough by an unexpected outcome, a malpractice lawsuit may be inevitable. You, even as lawyer, may need someone to help protect your legal interests. That's why it makes sense for lawyers to maintain professional liability insurance. 

Despite conscientious professional effort, human error can occur. And even when there is no error, a client could retroactively perceive a minor misstep as the reason behind a lost case. Once a client makes the decision to name you as a defendant, the financial impact can deplete any financial cushion you may have established. Professional liability insurance can take over on your behalf and keep that from happening. 

Behind Legal Malpractice Cases

A 2010 study published by the American Bar Association documented a wide range of reasons given for legal malpractice actions. The rationale for 42,076 legal malpractice claims filed in the United States and Canada ranged from "conflict of interest" to "civil rights violations."

The five most common causes of malpractice actions were based mostly on post-judgment examinations of attorney actions or judgment calls. These circumstances could happen to any busy attorney, regardless of caseload size or years of experience. 

1. Failure to know or properly apply the law 
2. Planning or strategy error 
3. Inadequate discovery of facts or inadequate investigation 
4. Failure to file documents to protect client
5. Failure to calendar properly, resulting in missed deadlines

Defending Yourself Can Cost You

If a client sues you over what they consider to be a legal mistake, it doesn't matter if they are wrong. As with any lawsuit or informal allegation, you still have to fight to defend your good name, and that can mean funneling your law firm profits into a defense budget.  

You know what happens once a suit has been filed against you. You'll incur ongoing costs and expenses. Organizing witnesses and evidence will mean time and income lost from your legal practice. To present a good defense, you will need to hire an attorney outside of your firm with no connection to the case. 

What if the Accusations Aren't Valid? 

As an attorney, you know the drill. Even if your former client has no legitimate basis for a malpractice action against you, you'll have to defend yourself anyway. The legal fees and expenses will continue until you've proven that the plaintiff doesn't have a valid case, until a judge dismisses it or until you settle the case to make it go away.

Legal Malpractice Insurance 

When you practice law, the client expectations you deal with may be as complicated as the legal issues you handle. A reasonable client will have reasonable expectations. But if a client expects impossible results and you can't deliver, you may have to defend yourself against a legal malpractice case someday. It's best to be ready.

That means documenting every action on every case. But it also means consulting with your independent agent to make sure you have enough professional liability insurance to cover your potential exposures and to protect your legal interests.