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If you're a solo attorney, the thought of malpractice insurance has no doubt crossed your mind. It's definitely not a bad idea. But before you purchase insurance from the first carrier that you find, you may want to keep your money in your pocket for just a moment and take into consideration a few things.
Shopping for insurance probably rates up there as one of the least enjoyable tasks faced by every day people. You hate shopping for auto insurance? We guarantee you, shopping for malpractice insurance is worse.
Fortunately, there are a few steps you can take to simplify the process. After all, many attorneys before you have tasted and known the pain of shopping for coverage just in case a client decided to show her distaste with more than just words.
Step by Step
First, you should shop around for carriers that remain in good standing in your jurisdiction. There is no one source, but the best place to look is your state's regulating agency. This agency's website will list a number of all available carriers in your state that are "admitted." If you're really glaze-eyed about this, have no fear: FindLaw is here.
Second, you should consider the coverage plans. If you're a very careful person, you can elect to purchase the lawyer's equivalent of auto-liability insurance. If you're prone to making stupid errors, you can either leave the profession now, or get the most Cadillac plan you possibly can muster.
Just like your auto insurance, your malpractice insurance will mostly not cover "stupid mistakes." These mistakes are most likely a form of negligence if not something more egregious that isn't covered.
Fortunately, the numbers are on your side since only a small percentage of private attorneys get sued each year. And since the costs associated with defending one's self from such a claim usually outstrip the premiums by a large margin, the better economic choice is to buy the insurance and breathe a little easier.
Legally Versus Practically
Again, there is no law that mandates malpractice insurance for attorneys, but we like to think that practicing without insurance is akin to riding roller-skating without elbow and knee-pads. You can sometimes get by without buying insurance depending on what business entity you operate your business under. For example, corporations and other limited liability entities give you protection that insurance largely would. But then you have tax issues to deal with.
And besides, if you were at the stage of incorporating, we figure that you're the kind of solo who'd already have insurance anyway.
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