Are You Covered?

A. Unlike car insurance, few jurisdictions require lawyers to maintain malpractice coverage. Of course, they don't require homeowner's insurance either. But few of us would cancel a homeowner's policy on a house that hasn't caught fire in 25 years.

Your criminal defense work may present a lower risk of malpractice claims than other areas of law. But since you also handle an "occasional accident case," you may need this coverage for an occasional accident of your own.

The cases that we dabble in often present the greatest risk of mistakes. If you err in handling a personal injury claim, an uninsured mistake may be quite costly.

Even if you never get hit with a malpractice claim, your lawyer's professional liability policy may protect you from things you didn't even know you were covered for. If you take the time to read your "LPL" policy, you will find "supplemental" coverage that goes well beyond liability for professional negligence.

Coverage amounts may differ, but virtually all LPL policies will reimburse you for legal expenses incurred in responding to a grievance and in defending against disciplinary proceedings. Unlike malpractice cases, most insurers will let you select your own lawyer to draft responses to complaints filed with your disciplinary board, to represent you in the course of disciplinary investigations and to defend you against ethics charges. To encourage you to use this coverage, your insurer will provide this benefit without any deductible and the expenses paid will not reduce your coverage for any malpractice action that may later ensue.

Many of us have read insurance policies on behalf of our clients, but have never taken the time to read our own. Unaware of this coverage, seemingly "frugal" lawyers have represented themselves in disciplinary proceedings without ever using the benefits that they've already paid for. Those who represent themselves may have fools for clients. But those who could have retained counsel on someone else's dime may feel all the more foolish for placing their careers in jeopardy.

Considering the expense of defending against disciplinary proceedings, this benefit alone may justify the premiums you pay for what you thought was merely "malpractice coverage." If that's not enough, many carriers now provide supplemental coverage for expenses incurred in responding to data breaches. While this is not as expansive as a separate cyber insurance policy, it may defray some of your expenses in retaining legal counsel and IT consultants, in notifying those affected by the breach, and even in providing credit monitoring to mitigate the damage. More than money alone, you will also benefit from claims personnel with experience in responding to these crises who may assist you with a plan to fix the problem.

Beyond this coverage, many carriers will reimburse you for the cost of responding to other regulatory agencies, the cost of responding to subpoenas relating to your professional services, and other needs.

Considering the thousands that you have paid for your policy over the years, you can easily spare a non-billable hour to read it. If you do, you will likely find more reasons to pay premiums than you ever considered before.

Your LPL policy won't be featured in the New York Times. But it may be the most unread "best-seller" in America. We pay for insurance hoping that we'll never need it. But only the foolish among us will cancel a policy without ever bothering to read it.