Professional Liability Insurance SimplifiedKeeping Your Insurance Simple & Effective
Have Questions? Need Help? Call Us! 1-877-569-4111

The Definition of “Claim” Under Insurance Policies

December 21, 2017

Lawyers Malpractice Claim

            Lawyers professional liability insurance is issued through claims made and reported policies. This means that coverage is dependent upon whether, and when, a claim arises and/or is reported to the carrier. In other words, if a lawyer becomes aware of a claim and fails to report it to the carrier in a timely fashion, coverage may not be triggered, and the benefit of the insurance is lost. Thus, it is important to understand what is considered to be a claim under your policy.

            The insurance definition of a claim is different from the legal definition. For professional liability insurance purposes, a claim most often is defined as any situation in which someone makes a demand for compensation based on an allegation that a person covered by the insurance policy has somehow breached a professional obligation.

            That demand need not be a formal suit filed in a court. It can be as informal as a conversation in which a client claims that they have been harmed because of a failure on your part, or a letter stating that they are withholding payment because they are dissatisfied with your work. Sometimes claims of this sort are first mentioned by non-clients: maybe the child of your estate client, or another party to a transaction where you helped draw up the papers. Other times, the claim may be brought by a former client of someone who recently joined your firm, over work that attorney did in her prior job.

            While many of these types of complaints might not ultimately be recognized as a viable legal claim under court scrutiny, they are enough to trigger a reporting obligation under a lawyers professional liability insurance policy. This means that, if you become aware of such a demand, you must report it to your carrier to trigger the available coverage provided by your policy. If you choose not to report (maybe you think the problem will blow over, or you can “fix” the problem without incident), you risk not having coverage if the claimant moves more formally later on.

            Alerting your carrier to an informal claim can also jumpstart risk control services available under your policy. Your carrier may decide to connect you with outside counsel for guidance on how to address the problem, for instance, or who can help settle before anything develops further.

            Additionally, under most policies, reports of potential claims is sufficient to trigger future coverage. So, if you recognize that something you have done or failed to do could result in damage to your client, and you report that potential to your carrier, you will have fulfilled your reporting obligations. Then, even if it is several years and policies later before an actual claim arises from that circumstance, your coverage under the policy that was in place at the time the potential claim was reported is available.

           Early reporting of claims or potential claims helps both you and the insurance carrier, by allowing for early intervention and risk control.

Protexure Lawyers /// Professional Liability Made Easy

“I found the Protexure representatives to be extremely professional, knowledgeable, and courteous. They found similar coverage for me for a substantial amount less than I had been paying. I have been pleased with Protexure’s service and would recommend it highly.”

- David M. Lipschutz, Esquire

Receiving a quote from Protexure Lawyers is made super easy by the quick response time of their team. The renewal process is different from what I have ever seen, they offer a mostly filled out application which made the process even easier for me!

- Eric Schwab - Woodbridge, NJ

It was a pleasure working with you, - you gave me the most competitive price, quick turn around and good follow-up.

- Howard S. Kavenow

My account representative was very helpful in assisting me to complete my application. He made me feel like my questions and my business were a priority to him.

- Kim Davis

When faced with a substantial increase from our existing malpractice carrier, we received the name Protexure Lawyers from a referral. On contact, they were not only very prompt in processing our application, but also responded to several coverage questions we had. So far, the service has been excellent.

- Law Office of Shriver, O'Neill & Thompson

Mr. Dixon contacted me many months ago and I told him I renew my policy in September and that it would be helpful to contact me in July or August of this year. He did that; he was very patient with me and assisted me with the application process. He was extremely prompt in replying to my inquiries. I had been with the same company for many years so I was reluctant to leave them. He made the transition quite simple. I am fortunate that he was the salesman who contacted me.

- Robert Lewin

Thanks. You guys got my business because (a) your price was great, and (b) you were responsive and on top of things (a number of insurers surprisingly were not).

- Scott Maxwell

I first came in contact with Ryan on a cold call. Usually I am dismissive of these types of calls, but Ryan was brief and to the point - no hard sell or over promising. In the end, I received a less expensive policy than others I researched. I guess not all cold calls are a bad thing.

- Steve Hunter

Ryan offered to compare my current insurance with what he and his company could offer. I took him up on this, and gave him my pertinent information. I did my own research, and discovered that his quote was lower and the carrier had an A rating. I contacted my existing agent to see if she could match the quote. I had been her customer for a number of years and thought that was fair. She was unable to match Ryan's offer.

- Steve Hunter

I discussed some minor differences in the policies with my account representative, and throughout the process, he was easy to reach and called me back promptly. I value this a great deal. In the end, it was clear to me that I would receive a less expensive policy than I currently have, with the same coverage and excellent customer service.

- Steve Hunter

Copyright © 2019 All Rights Reserved

Have A Question?

We are here to help! Fill out the form below and we will get back to you shortly.

You have Successfully Submitted your question!