Tuesday, August 12, 2008
The web page of the Virginia State Bar has a post from the past chair of the committee that has studied and proposed mandatory malpractice insurance for bar members. The proposed rule is set forth and summarized as follows:
The proposed rule is not complicated.
Currently, all active members of the bar engaged in the private practice of law representing clients drawn from the general public must disclose each year on the member’s annual bar registration whether they are covered under a professional liability insurance policy. 20 This information is then made available to the public.
The proposed rule also would apply to all active members regularly engaged in the private practice of law representing clients drawn from the general public. It and would require them to be covered under a malpractice policy obtained in the open market. The minimum acceptable policy would provide either $100,000 worth of claims indemnity coverage and an additional $50,000 worth of claims expense coverage, or $200,000 worth of claims indemnity coverage with no additional claims expense coverage. The active member shall then certify on the member’s annual VSB registration that he or she has the required insurance and shall provide the name of the insurance company and the policy number. An extended reporting endorsement, or “tail coverage,” would not satisfy this requirement. Should a member’s insurance policy lapse, be no longer in effect, or terminate for any reason, and not be replaced within thirty days thereby avoiding a lapse in coverage, the member must report such event to the bar. Failure to comply with the proposed rule would subject the member to an administrative suspension from the practice of law. No exceptions are provided. The proposed rule would become effective July 1 in the year following approval by the Supreme Court of Virginia.
The post concludes:
If you support the concept of protecting the public by requiring all lawyers who regularly represent clients drawn from the public to have malpractice insurance, the proposed rule accomplishes this goal as simply and inexpensively as possible. As proposed, it does have the potential of depriving some lawyers of their ability to engage in the private practice of law representing clients drawn from the general public. Those lawyers would be forced to change their type of practice. There are valid arguments on both sides of this issue. After three years of discussion, it’s time to call the question.