Benefits of Lawyer's Professional Liability Insurance
Lawyers face a myriad of risks regarding their profession from negligence to errors and omissions, which can leave them susceptible to a lawsuit. In fact, reports show that of about 951,000 working lawyers, more than 50,000 of them are likely to face an allegation of professional liability at some time in their career.
Lawyer's Professional Liability Insurance helps safeguard against these risks, and others, by insuring your business against certain claims and lawsuits, which can cause financial distress on your business. Also known as professional liability insurance and lawyer's errors and omissions insurance, this coverage provides legal professionals with liability insurance for the financial loss experienced by third parties resulting from omissions, errors, and other conduct related to providing professional legal services.
Professional liability insurance also helps protect your clients against major losses by helping lawyers meet their responsibility and protect their clients' interest in even the most worse case scenarios.
Professional Liability Coverage Under the Fidelity-Pak Program
Professional liability insurance under the Fidelity-Pak Program helps alleviate the burden by sharing some of the financial risks through restitution and defense coverage by shouldering much of the responsibility for responding and defending against whatever claims are made through claims handling services. Some professional liability coverage under the Fidelity-Pak Program includes:
Broad Professional Services Coverage
Attorney malpractice claims vary; however, probably the most common suits brought against lawyers are those claiming simple, straightforward, errors, including substantive errors of law and administrative errors.
The broad professional services coverage insures a full range of professional services provided. These include services and advice furnished by the Insured's practice as an attorney, including the Insured, mediator, title agents, or arbitrator in addition to services as an executor, administrator, trustee, guardian, conservator, receiver or similar capacity, within policy limits.
Disciplinary Proceedings Coverage
A disciplinary proceeding is a serious case involving the consideration of the suspension or expulsion of your professional license as a result of a breach or misconduct on your behalf, which can rack up serious expenses, fees, and costs in defense services.
Disciplinary proceedings coverage under the Fidelity-Pak Program offers disciplinary proceedings coverage of up to $10,000 per "policy period" for lawyer expenses, fees, and costs accumulated as a result of "disciplinary proceedings" initiated against the Insured.
Defense Cost Coverage
Defense costs coverage compensates defense for criminal, fraudulent, or dishonest acts as stated by the policy until final judgment. The defense for lawsuits professing willful or purposeful neglect to obey escrow instructions or binding authority is also covered by final judgment.
Fraudulent Email Wire Transfers Coverage
The FBI warns that one of the most common and potentially destructive cyber attacks affecting businesses today is the business email compromise scam. The EBC is a sophisticated scam in which hackers target firms that routinely perform wire transfer payments.
This type of criminal activity is usually carried out by advanced computer intrusion techniques involving legitimate business email accounts. During this kind of hack, the hackers hack into the email account of a person involved with open escrow. The fraudsters then monitor the account in anticipation of an email that contains wire transfer information. They then create a malicious URL that is nearly identical to the genuine website, in which they use to send out genuine-looking emails that change the wire instructions to send the funds to banks abroad.
The client whose funds are stolen then brings a lawsuit against everyone involved in the transaction to try to recoup their losses.
Under the fraudulent email wire transfers coverage, which offers both first and third party fraudulent email wire transfers coverage, the Insured is reimbursed up to $250,000 for an insured loss resulting from an employee of the Insured wiring funds from escrow from the Insured's account in belief of false email transfer instructions received from a fraudulent party posing as a legitimate party to the transaction. Under the third-party coverage, the Insured is reimbursed up to $1m for fraudulent email wire transfers.
The Escrow Security Bond (ESB)
The ESB allows lawyers to recoup losses accumulated as a result of deceptive acts, such as skimming cash, by partners, employees, and shareholders. Also, first party insurance is available for various other losses that may not be covered by other commercial first party or third party insurance, such as theft and vandalism.
Lawyer's Professional Liability Insurance is essential to the long-term success of your professional law practice. In fact, reports show that the number of lawsuits is on the rise, which makes it safe to say that this is one area of risk management you cannot afford to overlook to secure your business interests, as well as your clients' against significant losses.
About the Author
Riebling Insurance Agency is the preferred vendor partner for FNTG in offering all of its Title Agents and Attorneys the exclusive Fidelity-Pak program, underwriten by Llyod's of London. Learn more by visiting their website.