9 min read
ALPS In Brief Podcast-Episode 3: Stay Away from the Gray Area. Reporting Claims.
There are a number of common questions that policyholders ask in regards to reporting claims. In this episode, ALPS Claims Attorney John Ries talks...
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The world of insurance for law firms can be confusing, and difficult to navigate. We've created this glossary because these common insurance terms should be easy to understand.
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ALPS Team
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Updated on November 14, 2023 | Posted on October 15, 2019
Maybe obvious, but one of the most important considerations in a claims made and reported insurance policy is timely reporting. ALPS’ Claims Made and Reported Policy requires an insured to immediately report any claim or circumstance that could reasonably be expected to be the basis of a claim. Generally, coverage does not exist for a claim first made or reported before or after the policy period.
Attorneys are usually well aware of the reporting obligations involving their own cases. But what about cases handled by the other attorneys in the firm? Is an attorney protected by the coverage of the LPL policy by relying on one’s own personal knowledge of a claim or potential claim? The answer might surprise you.
The ALPS policy specifies that, “At the Effective Date of this Policy, no Insured knew or reasonably should have known or foreseen that the Wrongful Act might be the basis of a Claim.” In other words, an insured firm could be out of coverage if one insured attorney in the firm knew or should have known of a claim or circumstance that could give rise to a claim and did not timely report it. Therefore, for purposes of timely notification triggering coverage, you are your partner’s keeper.
This is especially true if knowledge of facts and circumstances predates an application for insurance whether it is an initial application or an application for continued coverage. The overwhelming view across the country, for courts dealing with this issue, is that no coverage exists for the entire firm and its individuals when one attorney fails to disclose facts regarding a claim or potential claim in an application.
We’ve seen coverage issues or potential coverage issues based on untimely notice in the following scenarios:
In order to hopefully spare a reader or two from learning the hard way, here are some suggestions:
In a nutshell, first, any multiple-attorney firm needs monitoring procedures to spot otherwise undetectable issues. There’s no “one size fits all” system; what’s best for a firm will vary based on its size and setup. Second, a firm must address warning signs with individual attorneys when they arise. By taking these steps, firms will be in the best position possible to timely spot matters that need to be reported to preserve coverage.
With an average of 10 years' experience at ALPS, your ALPS team is comprised of lawyers, customer service experts, marketing experts and insurance professionals. If there’s a problem you’re facing, rest assured this group of knowledgeable contributors has likely seen it and will help guide you to a solution that works to help you improve.
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