Our Firm Has Professional Liability Insurance, What Else Do We Need?

Kelan J. Vorbach, CIC

A variety of policies are needed to address the risks of a law firm. The most basic coverage portfolio includes:

  • Professional Liability (Legal Malpractice)
  • Business Owners Policy or Commercial Package Policy
  • Workers Compensation

This starter set, properly configured to the individual firm, addresses a wide variety of potential claims. I use the phrase “properly configured to the individual firm” because I often review policies that aren’t. Since professional liability is generally the most expensive of the three it generally gets the most attention while the other policies are automatically renewed and generally ignored. Most firms also face significant risks that the basic portfolio doesn’t cover or fails to address adequately. Additional policies most firms should consider include:

  • Privacy Liability (A/K/A Data Breach or Cyber Liability)
  • Employment Practices Liability
  • Directors & Officers Liability
  • Employee Dishonesty
  • Excess Liability
  • Buy Sell Life & Disability

Why don’t firms address these exposures? The reason may be money or lack of awareness. A firm’s insurance advisor may be reluctant to make recommendations that may not be well received because they result in higher premiums. If the firm is buying policies piecemeal from different agents, the firm may not have any one agent who feels responsible to provide advice. While most firms face similar risks, generally the more successful firms do a better job at insuring them with broader coverage.

In addition to the policies listed above, a firm may have specific coverage needs. For example if they provide company cars to partners they may need a business auto policy. They may need an ERISA bond or they may wish to offer group benefits. If you only have the starter set or if it has been years since you reviewed each component of your insurance portfolio, you have reason to be concerned. Make an appointment with your agent to review your policies or give me a call at 732-223-6611 ext. 108.

Kelan J. Vorbach, CIC is the Professional Liability Program Manager with John B. Wright Insurance. You can check him out at www.LawFirmInsuranceExpert.com.

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