| Coverage | Trend | Range |
|---|---|---|
| Lawyers professional liability - large firms |  |
Flat to -3% |
| Lawyers professional liability - midsize firms | |
Flat to -5% |
Key takeaways
- Claim frequency has declined.
- Frequency of catastrophic claims of $50 million or more have increased.
- Insurers have adjusted rates to account for the severity claims trend and capacity of $500 million or more is available resulting in a flat to downward pricing trend.
- Mistakes and unworthy clients are driving claims with corporate/transactional and litigation areas of practice experiencing increasing claims.
Law firms of all sizes have a favorable price, coverage and capacity market environment for professional liability insurance. Rates are flat to declining for firms with good loss experience and limits of $500 million or more can be purchased. Coverage is stable. While insurers are closely following use of AI with a focus on training requirements and governance, exclusions or conditions have not been imposed by the market. AI is seen as a potential risk management tool particularly in areas such as conflicts. Claims frequency continues to trend downwards while the frequency of catastrophic claims of $50 million or more continues to trend upwards. Size of transactions is pushing up settlement amounts with claims settling faster due to the high cost of defense. Both mistakes and challenging risks are responsible for a large proportion of claims. Corporate / transactional and litigation areas of practice are major sources of claims. Some risk management lessons that have emerged suggest additional focus on calendaring systems, more stringent client evaluation in new business intake and greater willingness to declining high-risk clients, documenting critical client advice and feedback, and appropriate supervision and staffing.
Disclaimer
WTW hopes you found the general information provided here informative and helpful. The information contained herein is not intended to constitute legal or other professional advice and should not be relied upon in lieu of consultation with your own legal advisors. In the event you would like more information regarding your insurance coverage, please do not hesitate to reach out to us. In North America, WTW offers insurance products through licensed entities, including Willis Towers Watson Northeast, Inc. (in the United States) and Willis Canada Inc. (in Canada).
Contact
Download