How does a new practice area affect professional liability?

Kelan J. Vorbach, CIC

A client sent me a great question,

 “If I handle a divorce and family law wasn’t specified on my malpractice application, do I need to to inform my carrier?”

You don’t have to tell your carrier immediately but you should talk to a professional liability specialist before venturing into any new area.  Most policies cover without limitation to the areas indicated on the application (assuming you disclosed all areas that applied at the time of the application). New areas must be disclosed on renewal.

 However, some areas dramatically increase your price for years, even if you only perform a one time service. Since it is better to know what you are getting into you should consult with an agent versed in professional liability before you are committed. A general practice firm that dabbles in a high risk area can spend more in premiums than they made in fees. 

If you have a question write me or call 732-223-6611.

www.LawFirmInsuranceExpert.com

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