What About Malpractice Insurance?

On a national basis, it is estimated that approximately 40% of attorneys practicing do not have malpractice insurance. If the attorney you are suing does not have malpractice insurance, it may be very difficult to collect monies if a judgment is awarded. In Florida, lawyers are not required to have malpractice insurance or to disclose this fact.

If there is insurance coverage, two things will happen after you start your lawsuit. First, the insurance company will assign a law firm to defend your former attorney against your claims. Second, the insurance company will set aside (or “reserve”) some amount of money to pay you if the attorney and insurer are not successful in getting rid of your case. The amount set aside will be determined by the value given to your case. This value will certainly be smaller than your view of the value of your claims. The efforts of the insurance company, and its payment to the defense firm, will be targeted at either disposing of your claims so that nothing will be paid to you, or greatly reducing the compensation due to you.

Even if the insurer recognizes that some compensation is due to you, it will delay paying it out for as long as possible, while you get more discouraged month by month. The delay the insurer imposes also creates risks for you. Evidence becomes stale, records are scattered, lost or destroyed, witnesses become physically unavailable, as by death or relocation, and they experience a fading of memory of facts pertinent to your case.

You will want to determine the amount of the deductible that must be paid by the attorney, and whether the policy is large enough to cover your damages.

Typically, if the deductible is large, your former attorney will want to litigate against your claims endlessly to avoid paying anything out of pocket. Even if the deductible is small, the insurance company will insist that their law firm assemble a lot of facts about the case before any decision is made about settlement. This can take years.

Assuming the policy is large enough to cover your damages, you have to assess whether your claims will in fact be covered by the insurance contract, or whether they will be excluded. Even if the nature of the claims is such that the insurer will not pay compensation, the attorney will generally still have his attorney’s fees paid by the insurance company.

NO INSURANCE. Of course, if your attorney does not have any insurance coverage, the circumstances of litigation will be even more difficult.

An important calculation for you to make, if your attorney has no insurance, is whether he is “judgment-proof.” For example, does he, or the law firm, have reachable assets? Or is your attorney too old to continue working so that future income can not be attached in the event you do win a legal malpractice against him?

If you have suffered as a result of your attorney’s wrongdoing, contact my firm to arrange a time when we can discuss your case.

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