If you’re a lawyer, what keeps you up at night? As a former practicing lawyer who’s been in the professional liability insurance business for over 20 years, that’s a topic I spend a lot of time thinking about.
Maybe it’s how advances in technology can make communicating with clients easier but can also be a double-edged sword since technology introduces new and potentially severe security issues we didn’t have to worry about before. Or how a slumping economy can result in lawyers getting sued because clients are looking for a scapegoat regarding their financial hardship.
For brokers selling professional liability insurance, it’s vital to understand lawyers’ evolving priorities and pain points.
With that in mind, here are some trends for brokers to keep a closer eye on when it comes to professional liability coverage for law firms.
A big topic among law firms, especially those who specialize in health care and representation of financial institutions, is how they can best keep their clients’ private information from getting into the wrong hands. What risks are associated with the kind of information they keep about their clients? Insurers are paying close attention, too. At Argo Pro, for example, we’ve recently updated our Lawyers PROtectSM policy form so it specifically delineates third-party cyber liability coverage.
I’m on the professional liability executive council of the Claims and Litigation Management Alliance (CLM), and cyber security is a recurring hot topic for us. In April, CLM Magazine ran an excellent feature on creating an effective cyber incident response plan. If you missed it, you can read it here.
2. The economy
Did you know that lawyers care about the economy? It’s because when the economy is sluggish, you’ll likely see an uptick in valuation-related claims. That puts lawyers at risk of being sued when clients who held valuable assets that nose-dived during a shaky economy are looking for someone to blame.
Although we’re nearly a decade away from the economic crisis of 2008-09, we’re always keeping an eye out for the next cyclical downturn. According to the National Bureau of Economic Research, there were 33 business cycles (upswings and downturns in the economy) in a span of 155 years – averaging one every 4.7 years!
Do you have best practices in place for how recessions affect your insureds and what you can do to support them? There is no better time than now to learn from the past recession and prepare yourself for the next one.
3. The political landscape
Who isn’t talking about politics and the economy these days? Even with the presidential election behind us, there is always something new to track. All of these decisions around leadership and regulations impact lawyers, which can potentially alter their insurance needs.
In addition to closely following the news to stay in the know, we recommend creating an informal advisory committee and a process of sharing information within your office that might impact your clientele. It can be a casual weekly show-and-tell, or perhaps an email listserv for employees to send applicable news to fellow colleagues. That way, you can more proactively approach your clients about their needs.
4. Email and social media
Lawyers can share information with their clients as easily as sending an email from their laptop, blogging on the firm’s website or sending Twitter or LinkedIn updates. These have all become popular ways of communicating, which wasn’t the case 10 to 15 years ago. But that means it’s more critical than ever for lawyers to proactively discuss with their clients agreed-upon methods and frequency of communication, which can help prevent clients and others from misinterpreting something as legal advice. Lawyers must also discuss the risks regarding transmitting data that’s confidential. Clearly, there were risks involved when it came to leaving a briefcase on the park bench just a decade ago. But today’s lawyers are even more exposed to losing a large amount of client data if a laptop is lost, stolen or compromised.
At Argo Pro, we recommend lawyers ask their clients at the onset what their communication preferences are and subsequently outline them for everyone working on the account. Thus, pending the preferred channel of communication, the law firm can protect and archive the information accordingly. Lawyers should also discuss with their clients appropriate transmission of confidential data and provide disclaimers and warnings on the firm’s website about the risks related to sending it. Of course, a firm’s IT specialists should have up-to-date tools available to protect information received by clients and also have an appropriate disaster-recovery plan in place.
These are just a few of the trends brokers should pay attention to.
About the author
Kim Noble is senior vice president of the Lawyers’ Professional unit at Argo Pro. Noble has over 20 years of professional liability experience, both as outside counsel and in underwriting management roles. She is licensed to practice law in four states, and holds Chartered Property Casualty Underwriter and Registered Professional Liability Underwriter designations. A frequent speaker and author on malpractice and risk management topics, Noble is an active member of many organizations including the American Bar Association, the Defense Research Institute and CLM.
About Argo Pro
Argo Pro, a member of Argo Group, is a leading provider of professional lines insurance products and services that can accommodate medium and large organizations on an admitted and non-admitted basis. Through a single operating platform and a robust network of appointed wholesale and retail distribution partners, Argo Pro offers a broad, customizable portfolio of errors and omissions and management liability insurance solutions. Argo Pro maintains offices in Chicago, New York City, San Francisco, Scottsdale and Hamilton Township (New Jersey).