Lawyers Professional Liabilility Insurance E&O can be one of the most difficult E&O classes you will ever come up against. Let us help you navigate some of the pitfalls you may experience when trying to write this challenging coverage line. Here are a couple of quick examples of things we can help you watch for.
Do all carriers use the same underwriting critiria? No, not even close. No two carriers have the same underwriting "box". Sometimes their is no rhyme or reason as to why one carrier will consider something a difficult class when another carrier sees the same account as being no big deal. For example, one case I recently ran up against was a law firm that did not have any claims and specialized in real estate taxes. One carrier considered this to be a lawyer specializing in tax work, another considered it to be a firm specializing in real estate work. The difference was the carrier that classified this work as "real estate" wanted twice the premium! Never assume that one carrier is the end all be all for a particular class.
If my insured put it on the application, it's covered right? Just because your client has a policy does not mean it is going to protect them in the event of a claim. Don't assume that the policy they currently have is covering everything they do. They may have "the best price" however that does not mean they are covered. As an example, if the insured puts on an application that they do a small percentage of copyright and trademark work, Many policies have exclusions for copyright and trademark work. Make sure you are getting what you think you are paying for.
My client had a catastrophic claim and has been kicked out of the standard markets. What can they expect? One of the worst things for any one who purchases insurance is to have the dreaded limit loss claim. Of course, that's why they buy insurance in the first place. For lawyers, they can go from paying $1,000 and having a $1,000,000 policy with a $2,500 deductible with an admitted carrier, to having a $500,000 limit with $15,000 deductible and paying well North of $15,000. Typically speaking, the first year or 2 after the incident this is to be expected. Assuming they keep their nose clean and don't have any other incidents, premiums will slowly come down after that. Once they hit the 5 year mark of being "claims free" they can usually look to move back to the admitted markets as most carriers only require loss runs for 5 years.
So what do you need to know about "the big claim"? A lot of insured's feel the need to explain why something was not their fault. If a lawyer puts on his claim supplement how it was not his fault or it was just a fluke, they will pay for it. The best policy when explaining the loss is to be honest. Underwriters will tell you they are more willing to work with and sympathize with a client that made a mistake, owns up to it and explains how they will fix it in the future than one that is not willing to accept any fault.
My clients policy expires this week. Do you have enough time to market the account? Lawyers are very busy people. Insurance is usually the last thing on there mind until they get that call reminding them that they will not have any coverage at the end of the week. We understand this. Give us a call and we can turn the account around for your quickly.
While we can help you with accounts starting around $2,000, we specialize in hard to place and distressed accounts. If you already have a completed application we can use this as a good starting point to market your account. If you are in need of an app however, due to the different suppleements and different underwriting boxes of each carrier, please give us a call to discuss your account so we can better determine what will be required in order to offer terms. The basic information we will require is:
- Do they currently have coverage? If so have they been non-renewed? If so why?
- What is the retro date on the current policy?
- How many attorney's work at the firm?
- How many non-attorney staff?
- What is their area of practice?
- What state(s) do they practice in?