Risk for Lawyers & Attorneys
Law firms may have plenty experience in court, but it’s the last place they want to end up defending themselves. Just like any profession, lawyers face a number of risks that require comprehensive insurance coverage. As a lawyer, you advise clients, which comes with a whole host of risks. You also may have an office space or spend a lot of time on the go as you visit clients and attend hearings. Here’s an overview of insurance that law firms and lawyers should have to protect themselves from the day-to-day risks of doing business.
Business Owner’s Policy (BOP)
A Business Owner’s Policy, or BOP, is a common policy bundle that most small business owners are eligible for. A BOP combines property and liability insurance - two of the most common types of coverage recommended for small and mid-size businesses. It may also include Business Interruption coverage, which is helpful if your business is ever forced to close due to a disaster out of your control.
A BOP comes in handy if you have a physical office space where non-employees might visit, because it protects you in case of third party injury claims. A BOP will also protect assets that could be damaged or stolen, such as office equipment and computers.
As a lawyer, you may also consider adding Data Breach coverage, since it’s likely you hold a lot of private and sensitive customer data. For example, your contracts probably contain things like signatures and social security numbers that a hacker could use to steal someone’s identity. Data Breach insurance will help you recoup costs surrounding notifying customers if a breach occurs and rebuilding your reputation in the aftermath.
Workers Compensation
While you probably don’t associate legal work with a high chance of on-the-job injuries, accidents do happen and it’s important to have Workers Compensation insurance if you have employees. In fact, it’s mandatory once a company reaches a certain number of employees in most states.
Workers Compensation covers medical benefits and lost wages in the event that an employee is injured on the job. It also protects the employer from having to pay for damages if they are found negligent, and reduces employee lawsuits.
Working as a lawyer often requires long hours in front of the computer and driving to client locations and court appearances. If an employee suffers a repetitive stress injury on the job, or gets injured in an accident while visiting a client office, Workers Compensation can be incredibly valuable.
Hired & Non-Owned Auto
Speaking of accidents, attorneys and their employees may frequently find themselves driving on company business in non-company owned vehicles. Whether your employees are heading to a client’s office or court, you may want to make sure you’re covered in case of an accident with Hired and Non-Owned Auto coverage. If an employee is involved in an accident, your business could be held liable for damages.
You might be thinking, but I already have Commercial Auto insurance. However, Commercial Auto insurance primarily is meant to cover employees operating company-owned vehicles - not their own.
Errors & Omissions
Errors & Omissions insurance, or E&O, is key for the legal industry. This type of insurance protects you if a client claims injury because you didn’t deliver on something you agreed to, regardless of whether or not their claims are valid.
For example, if a client sues you for mishandling a case or making a mistake in a contract that costs them, E&O insurance can cover associated legal costs and settlements.
It’s important to note that E&O policies only takes care of incidents that happen while you are covered. If you switch to a new carrier and then an error is discovered from a period during which you weren’t covered, you may be out of luck.
Even if you’re extremely detail-oriented and great at your job, E&O insurance is important to have. Mistakes happen, and it’s better to be prepared for them.