Lawyers, especially solos. Need advice on Professional Liab Insurance

[Chickenman Testa]

Board lawyers - a good link or advice would be nice.

Background - I've been in job hell since last April. Just transitioned to contractor status due to lack of work with my company, but about to terminate that situation in favor of a 6 month contract job that could (at best) morph into a full time job if this company's growth plans come through, but at worst gives me a 6 month landing place at great pay with the freedom to look for a full time job.

Anyway, one of my closest friends works at this target company and I would be supporting the solo GC who is overwhelmed with work and needs help. If things work well and the GC gets his wish, he'll hire me full time ASAP. All he asks is that they get a kind of informal Right of First Refusal if I get a full time offer. That is, they realize I need some stability but want a chance to add me as a FTE if possible.

My question involves possible insurance (E&O? Professional Liability) I might need as an independent contractor in a legal role. When I first moved to Austin, I started in a Contract role, but I was younger, relatively unsophisticated, and, more importantly, a judgement-free debtor if you catch my drift. With my financial stakes a little higher, I'd like to know if it's worth it to purchase short-term insurance, what the costs are approximately, and what providers are out there. I'm assuming my State Bar website might be a good place to start. I've never had to explore this before as I've always either worked for a firm or in-house as a FTE.

Thanks in advance.

This post was edited on 3/14 2:31 PM by Chickenman Testa

 

[dmk228]

Check with the firm where you'll be engaged as a contractor. It's very possible their PL coverage provides protection to you even if you're not a FTE. Whatever they say, make sure you have a clear understanding and get it in writing.

 

[Chickenman Testa]

Thank you ###

nfm

 

[fairgambit]

I've been a solo for my entire legal career (40 years). I've always carried insurance, and I would recommend you do the same. I've never had a claim but I sleep easier knowing I'm covered if I ever do. I get mine through my local bar association and the cost has actually come down in recent years. I can't remember the exact premium, but I know it's less than 2K a year. Of course, much depends on the amount of coverage and deductible. Have you asked your new boss about his insurance, if any? By the way, in Pennsylvania, if a lawyer does not have coverage he must notify every client of that fact before he begins representation.

 

[Kroixklk]

Pace professional services ask for mark get at least 250k

 

[LighthouseGolfer]

I've been a solo for over 10 years. Big firm before that. I'm insured through Minnesota Lawyers Mutual Insurance Company. Don't just go with the cheapest. Make sure you understand the coverages you are getting including but not limited to defense costs in the event you are sued. Luckily I have not been sued but this is something I don't mess around with. Good luck.

 

[LafayetteBear]

Chickenman: Your post indicated that you are looking at working for a "company," which suggests to me that you are not talking about a law firm here. If so, it is very unlikely this company has any kind of legal malpractice insurance in place to cover its lawyers. Probably not even for your friend, the company's general counsel.

I've never researched the issue, but I have serious doubts whether a company which received faulty legal advice (or faulty legal services) from a lawyer functioning as an employee could maintain any kind of legal malpractice claim against that lawyer/employee. Seems to me that the employer-employee relationship would probably trump the attorney-client relationship in this context, and insulate the lawyer employee from negligent advice (or services) if they were rendered in good faith. The corporate law statutes in most states exempt corporate officers from liability to the corporation for negligent acts, provided the officer was acting in good faith.

If you are acting as an independent contractor, the relatiohship with the corporation is a bit different. Nonetheless, if you are working full time for this company and it is your only client, it seems only fair to me that they should either agree to reimburse you for the cost of any legal malpractice insurance you carry to cover you for legal services rendered to them, or else that they agree in writing that you will have no professional liability for legal advice or services rendered in good faith.

My two cents...


This post was edited on 3/15 4:45 PM by LafayetteBear

 

[Chickenman Testa]

LB - your assumptions are correct. Inhouse but IC status (for now)

The GC is a friend so I'll just hash things out with him. They have been very accommodating with everything else and I don't foresee problems - indeed, I think they're happy I've been such a stickler on the various employment agreements - paranoia and caution are good traits for a company lawyer.