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Lawyers Professional Liability Insurance


Does Your Lawyer Have Insurance?

Many lawyers have professional liability insurance, commonly known as malpractice insurance.  It covers claims that a client was harmed by the lawyer’s mistake.  Lawyers are not required to have this insurance.  Each year, lawyers in private practice must tell the Supreme Court if they have this insurance.  Even if a lawyer buys this insurance, some claims are not covered.  You should know these facts about lawyers’ insurance:

    1.  Most malpractice policies cover only claims made during the policy term.  You probably have car insurance.  It covers you for accidents when the policy is in effect, even if the claim is made years later.  Malpractice policies are different. If a client makes a claim after the policy ends, the claim is not covered.  This is true even if the policy was in force when the claim arose or the loss happened.

     2.  Malpractice policies have limits and exclusions that may be important to you.  Malpractice policies limit the amount paid on a single claim and on all claims made during the policy term.  They may not cover some kinds of legal work.  A lawyer who has insurance covering tax law may not be covered handling a divorce case. 

     3.  Malpractice policies do not cover criminal acts.  These policies cover only negligence.  Negligence means failure to use ordinary care.  This kind of insurance will not cover theft of money or property.  Losses caused by dishonest lawyers may be covered by the Minnesota Client Security Board.  Find out more at http://www.courts.state.mn.us/csb/csb.html

      4.  The court does not check on insurance policies.  Lawyers report on their own policies.  The court does not check these reports.  But a lawyer who makes a false report can be disciplined. 

    5.  A lawyer may have a good reason for not having this insurance.  If you have questions about a lawyer’s insurance, ask the lawyer directly.  The lawyer may be able to tell you why he or she does not carry insurance. If the lawyer has insurance, ask if it covers the kind of work the lawyer will be doing for you.