Lawyers Professional Liability (also called Lawyers Errors and Omissions Insurance and Lawyers Malpractice) protects law firms from claims if their client holds them responsible for errors in the representation of the client's case.
Coverage includes legal defense costs - no matter how baseless the allegations. Professional liability will pay for any resulting judgments against the firm, including court costs, up to the coverage limits on the firm's policy. Some policies provide costs in addition to the limit for additional premium.
In a culture saturated with law firms, you may be surprised to realize many do not carry malpractice insurance. That could mean substantial opportunity for retail agents.The majority of firms not carrying LPL are sole proprietors or small firms with 2 to 5 lawyers, and many of these small firms do not carry malpractice coverage. Some estimates state that 1/3 of attorneys in this country practice uninsured, meaning that there is substantial opportunity in the LPL marketplace.
The underwriting of these policies is dependent on the type of law the firm practices, the jurisdiction, the length of time the firm has practiced as well as the number of attorneys in the firm. How the firm maintains the docket and clearance procedures and any claims it may have had in the past all play a role in the premium calculation.