Are Your Law Firm Clients Entitled to a Reward for Good Behavior?
As a good broker, you understand the unique risks and liabilities that lawyers and law firms face in today’s world. But do you know about the rewards?
Each year, your law firm clients pay a premium for professional liability coverage. And many of those clients may remain claim free year after year. Are they entitled to a reward for good behavior?
Essentially, yes, if they are insured with Vanguard Specialty’s Admitted Lawyers Professional Liability Program. Your client will be rewarded at the first renewal with our program if the firm is considered "claim free". But we have added in some “grace” so that it is easier for a firm to maintain their rewards. Basically, if any matter reported to the carrier has total incurred for damages and claims expenses of less than $5,000 for the first year, then they are considered “claim free” for purposes of maintaining their rewards. And if they are claims free for a year, their deductible can be lowered 10% each year, along with other incentives.
Unfortunately, small firms and solo practitioners are not viewed very favorably by the insurance market overall because they tend to report more claims per lawyer than larger firms with 10 or more attorneys. But we believe that those small law firms that do not have claims issues should be entitled to a benefits from being claims free. In fact, since smaller law firms do not have the resources of larger firms, they are more vulnerable to professional malpractice claims and need all the protection they can get. And despite the fact that 50% of attorneys today work as solo law firms, from a broker perspective, it’s still a pretty underserved market. Understanding how claims free rewards work and what your clients might be entitled to can help you better serve your current clients, while attracting new ones.
Here's how our Rewards Program works:
For each year that your client remains claim free, their retention is reduced by 10%, up to a maximum 50% reduction over five years. This could result in significant savings in the event a firm has a claim.
For each year that your client remains claim free, $50,000 of an additional claims expense limit is added, up to a maximum of $250,000 over five years. This helps preserve their primary limits to satisfy any payments for damages.
Determination of being claim free increases by $5,000 of total incurred for damages and claim expenses each year, up to a maximum of $25,000 by the fifth year with our program.
Since the Rewards increase each year, it makes it easier for the law firm to renew with us, which means less paperwork for the law firm, less shopping for you, and our carrier gets to renew its best insureds in the program.
Lean on our expertise
On top of the Rewards Program, we have designed our admitted Lawyers Professional Liability policy to be among the broadest coverage forms out in the market today. From coverage for punitive damages (where allowed by law), individual ERPs for a flat $1,500, no minimum age requirement for our retirement tail, a 15% ownership exclusion, coverage for pro bono work, to generous coverage extensions for loss of earnings, pre-claim expense coverage, disciplinary proceedings coverage, and subpoena assistance, we are widely viewed as providing premier coverage for our law firm insureds.
If your brokerage handles the insurance needs for law firms and you’re interested in leveraging these reward opportunities to help your clients and grow your business, contact Stephen van Wert, Managing Director at Vanguard Specialty at Stephen.Vanwert@vanguardspecialty.com or 813.999.8090.