You pay for your professional liability insurance policy so your insurer will protect you against claims regarding errors or omissions. In a perfect world, your insurance is all the financial protection you’d need. Unfortunately, in some cases, your insurer is the party you need protection from. That’s why working with an insurance attorney specializing in professional malpractice claims is so important.
Specialized attorneys play a vital role in guiding professionals like you through the complex legal landscape of insurance claims and litigation. Their expertise is particularly valuable for professionals such as doctors, architects, and accountants, who may face malpractice claims in the course of their careers. Let’s break down how liability claims are supposed to work, why you may need outside help, and how the right lawyer can help you pursue the coverage you’re owed.
How Professional Malpractice Insurance Claims Should Work
Professional malpractice insurance, also known as professional liability insurance or errors and omissions insurance, is designed to protect professionals if they are accused of malpractice. It covers legal defense costs and any settlements or judgments awarded against the professional.
Malpractice occurs when a professional fails to provide services at the accepted standards of their profession, resulting in harm or loss to a client or patient. This can include errors, negligence, or omissions during the course of their professional duties. A professional malpractice insurance claim refers to a formal request for coverage or compensation made under a professional malpractice insurance policy.
A claim is typically initiated when a client or patient alleges that they have suffered harm due to the professional’s negligence or error. This can be a formal legal complaint or a demand for compensation. The professional must promptly report the incident to their insurance company. The insurer will then assess the claim to determine if it falls under the policy’s coverage.
The insurance company then conducts an investigation to evaluate the validity of the claim and the extent of potential liability. This may involve reviewing case documents, consulting expert witnesses, and assessing the damage or harm caused.
If the claim leads to a lawsuit, the insurance policy typically covers the cost of legal defense, including attorney fees, court costs, and other related expenses. The insurer may negotiate a settlement with the claimant on behalf of the professional. If the case goes to court and results in a judgment against the professional, the insurance policy may cover the settlement amount, up to the policy limits.
Risks of Denied and Underpaid Malpractice Insurance Claims
All insurance policies have the same underlying problem: insurers are for-profit companies, so they have strong incentives to deny as many claims as possible. That can lead less scrupulous insurers to deny or underpay claims that should otherwise be covered. For professionals facing malpractice allegations, that can pose serious problems, including:
- Financial Burdens: Without sufficient insurance coverage, the professional must bear the full cost of legal defense, which can be substantial. Furthermore, if found liable, the professional would be responsible for paying settlements or judgments out of pocket.
- Professional Reputation: A denied claim might necessitate a more public legal process, potentially harming the professional’s reputation, especially if the case garners media attention.
- Licensing and Career Impact: Malpractice lawsuits can affect professional licensing and credentials. A denied or underpaid insurance claim leading to a lawsuit may result in disciplinary actions by professional boards.
- Emotional Stress: Facing a malpractice lawsuit without insurance support can be extremely stressful and distracting, impacting the professional’s ability to work effectively.
These are the exact problems that E&O insurance is supposed to protect professionals from. If your insurer wrongfully denies or underpays a malpractice claim, you may be in a worse position than if you had never purchased the policy at all.
How Insurance Attorneys Support You in Professional Malpractice Claims
While insurers have strong incentives to deny or underpay claims, you have options to ensure they fulfill the terms of your policy. Specifically, you can work with an experienced insurance attorney to streamline the process and avoid many of the potential risk of an unjustly denied claim. Some of the biggest benefits of working with an attorney include:
1. Legal Advice and Representation
Insurance attorneys are well-versed in the laws and regulations governing professional malpractice. They provide legal advice to professionals on how to navigate these laws. In the event of a claim, your attorney represents you in all legal proceedings, including negotiations, arbitrations, and court trials.
2. Claim Assessment and Management
A fundamental duty of an insurance attorney is to assess the validity and extent of the claim against the professional. This involves analyzing the circumstances of the alleged malpractice and the potential liability. In addition, your attorney will guide you through the claims process, ensuring timely and accurate filing of necessary documentation and responses.
3. Liaison With Insurance Companies
Your attorney will review your malpractice insurance policy to understand coverage limits and exclusions. They’ll negotiate with insurance companies on your behalf to secure the best possible outcome, whether it’s a settlement or defense provision.
4. Specialized Knowledge and Skills
Insurance attorneys specializing in professional malpractice have in-depth knowledge of the specific industry they serve, enabling them to offer tailored advice. They also possess strong negotiation and litigation skills, which are crucial in resolving claims effectively.
The Importance of Insurance Attorneys in Professional Malpractice Claims
Having an insurance attorney is crucial for professionals facing malpractice claims. They not only provide legal representation if your insurer attempts to deny or underpay a claim, but also offer peace of mind during stressful situations. Their role is multifaceted, encompassing legal advice, claim management, liaison with insurance companies, risk management, and specialized expertise.
If you’re facing a liability dispute and struggling to work with your insurer, the experienced attorneys at Furukawa Castles are available to help. Our skilled team members are indispensable allies for professionals navigating the complexities of malpractice claims. We are prepared to ensure that you are well-informed, adequately represented, and prepared to take on your insurer if necessary. Schedule your consultation today to learn how we can assist you with your professional liability insurance issues.
