A law firm may find that renewing its legal malpractice policy with the same insureryear after year is advantageous for a number of reasons.

For example, the law firm and insurer may build a strong workingrelationship, and there is a lesser risk of “gaps” in coverage thatcan form when the law firm changes insurers.

However, at the same time, law firms that are too complacentwith their current coverage and insurance policy may lose out onbetter, cheaper coverage that may be available as the insurancemarket changes. While each law firm has unique considerations indetermining whether to change insurers, there are certain issuesthat will likely carry the most weight when assessing the pros andcons of switching. Below are four key factors.

Cost considerations

The market for legal malpractice insurance is extremelycompetitive and can be volatile. In particular, when new insurersbegin writing legal malpractice policies (or others phase out orconsolidate), the change in competition may cause downward pressureon premiums. Thus, attorneys and law firms with a good claimshistory may have significant leverage when it comes to setting apremium. Insurers may be eager to underwrite a firm that has strongloss prevention techniques. (Some law firms even hire counsel toadvise them on claim-prevention techniques that may be attractiveto an insurer in setting premiums.)

Continue Reading for Free

Register and gain access to:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.