Law Firm Risk Management Issues and the Increased Liability of Corporate Counsels

Law Firms increasingly have found themselves confronted with the same risk management issues as other businesses. Third party claims from errors and omissions, employment practices' claims, loss of business income stemming from e-commerce incidents, breakdown to EDP systems from computer viruses and loss that has resulted from a lack of analysis of office leases, such as uninsured improvements and betterments and leasehold interests, are among the several claims' scenarios that JMP has extensive experience. JMP has programs that can readily transfer these exposures on a very competitive and cost efficient basis.

In the same vain, it is now widely recognized that there is a heightened liability exposure to in-house corporate counsel, who advise management on critical legal issues and who, to a large extent, can influence, if not control, conduct of a company and its directors and officers.  In the wake of numerous highly-publicized recent corporate debacles, courts, legislators and regulators are imposing more rigorous standards on these in-house advisors, resulting in more claims against in-house counsel and unprecedented liability exposure from a wide variety of potential claimants.  For example, in-house counsel usually are heavily involved in many aspects of a company's compliance with the Sarbanes-Oxley Act, and are now required to report 'up the ladder" any evidence of material violation of securities laws or breach of fiduciary duty.  Failure to properly discharge these responsibilities can create new and potentially dangerous personal liability concerns for counsel. Specific coverage designed for the exposures confronting in-house counsel is available to clients of JMP.  Co-ordination of D&O cover with in-house counsel coverage is a specialty of JMP.

JMP represents numerous law firms in the Delaware Valley area ranging from sole practictioners to firms with over 100 employees. We handle all lines of coverage for our law firm clientele. Additionally, we have secured two exclusive professional liability contracts with "A" rated insurers. This has allowed greater competition in a market previously dominated by the Philadelphia Bar Association. There are viable alternatives and they are available through JM Patton!

Coverages available are as follows:

If you want an in-depth analysis of your current program and a comprehensive alternative, please contact either Krista Grugan at kristag@jmpatton.com or Barry Persofsky at barryp@jmpatton.com.