Errors & Omissions can be a crucial policy for attorneys to have, since it will protect against various forms of malpractice, including failure to warn, bad advice, and honest mistakes. Besides having this protection, attorneys must be careful to choose an Errors & Omissions for lawyers policy that prevents chronological gaps in coverage. Anyone in the market for Errors & Omissions insurance should understand the policy additions that can offer protection against these gaps.
Prior Acts Coverage
For many Errors & Omissions policies, coverage starts on the date the policy is purchased. However, some policies allow an earlier coverage date to be set. The policy then provides retroactive coverage. Some insurers require policyholders to make a statement that they are not aware of any pending claims before they receive Prior Acts coverage. However, each insurance company has its own procedures.
Extended Reporting Period Coverage
Extended Reporting Coverage, also known as tail coverage, provides coverage for claims that are made after a policy expires but pertain to actions that occurred while the policy was effective. To be covered, the claim must be reported to the insurer within a designated Extended Reporting Period. This is another variable that can be appreciably different between insurers, so anyone purchasing Errors & Omissions for lawyers should verify that the reporting period offered is sufficient.
Ensuring Adequate Coverage
Both of these policy enhancements make smart additions for most attorneys. However, attorneys can still benefit from seeking professional advice about areas of vulnerability and additional policy enhancements before making a final decision.