Law firms, like all businesses, need to be insured. Insurance protects law firms from claims made against them, which can help to protect them financially and keep them in business. If you own or are a representative of a law firm, then you need insurance. This article will tell you which types of insurance your firm needs:
Types Of Insurance That Law Firms Need
General Liability Insurance
General liability insurance is very important. You need to explore your general liability insurance options before you set up shop. General liability insurance is a broad type of insurance that essentially covers you against any ‘general’ claims. This type of insurance will protect you from most types of lawsuits. It will also protect your business premises. If anybody is injured on your premises, then this insurance will cover their claims and payout compensation. You also need to invest in property insurance, which will protect you against fires, floods, or other natural disasters. Property insurance is usually combined with general liability insurance in most insurance packages.
Professional Liability Insurance
This type of insurance is also known as legal malpractice insurance. It’s absolutely essential for you to be covered by this if you own a law firm. This type of insurance will protect you from legal malpractice claims. Some examples of legal malpractice are failing to meet deadlines, failing to learn the details of a case, failing to communicate properly with clients, and settling a claim too soon. Legal practice can be an absolute nightmare if you’re not insured. If you’re not covered by this type of insurance, then you can be sued for a lot of money. It will also cover any legal defense costs or expenses related to malpractice lawsuits.
Cyber Liability Insurance
Most business is conducted online nowadays, even in legal matters. If your law firm stores and manages data online, then you’ll definitely want cyber liability insurance. Law firms are quite regularly targeted by sophisticated fraud gangs and hackers, who want to exploit and steal information related to lawsuits and legal cases. Cyber liability insurance. Cyber liability insurance will protect your business against threats posed to it by hackers. It will also payout if you have had money stolen through phishing scams.
Employment Practice Liability Insurance
If you’re a solo attorney, then you won’t need this type of insurance. If you employ people, then you will. Employee litigation is becoming incredibly common. Employment practice liability insurance will protect you against lawsuits mounted by your employees. This insurance will cover the cost of your defense, as well as any settlements or judgments that are made against you.
Directors And Officers Insurance
Directions and officers insurance is something else that you’ll want to invest in. It covers the cost of compensation claims that are made against your firm’s directors and officers, for acts such as breach of trust, lying, and handling a case poorly. It’s a type of insurance that is definitely worth investing in, especially if you operate a large law firm. Again, if you’re a solo attorney, then this type of insurance might not be necessary.
There are other types of insurance that you might want to invest in if you run a law firm, though this article has covered the most important types. Make sure you’re always protected and insured, so you don’t lose money to compensation claims.