One of the ways that the Law Society discharges its mandate of protecting the public interest is to provide insurance for lawyers to ensure that, in the unfortunate situation where a lawyer makes an error that causes a loss to a client, the client will be compensated for the loss. The comprehensive insurance coverage provided through the Lawyers Insurance Fund (LIF) is not only one of the broadest in the country, but it is also one of the most affordable; in 2017, the $1,750 fee was the ninth-lowest among legal-profession insurance policies in Canada.
In addition to broad coverage, lawyers consistently rate the service they received highly; in 2016, 97 per cent gave top scores for their overall satisfaction with the service provided by LIF claims counsel — at four or five on a five-point scale.
BC lawyers can be confident in their coverage. Unlike lawyers in other Canadian jurisdictions, they are covered, within broad parameters, for advice given in any area of law, anywhere in the world. Moreover, and unusual for errors and omissions insurance policies, if an error is made while a lawyer is practising and insured that is not discovered until after the lawyer leaves practice, coverage is still provided to the full policy limit.
Risks in the legal profession are constantly changing, and LIF policy coverage evolves to meet new demands. In 2012 Part C was added to provide some coverage for losses resulting from “bad cheque” scams, and it was recently expanded to apply to losses resulting from certain kinds of “social engineering” frauds. Common examples of the latter are where a lawyer receives email instructions to change the recipient of funds on a closing, from an email address that looks very similar to that of a client, or is instructed by email to send funds to a third party from an imposter posing as a senior partner or a bank representative.
The effectiveness of the program depends to a large degree on early reporting of claims or potential claims. The insurance policy requires lawyers to report claims or potential claims as soon as they become aware of them. Often, a potential claim can be remedied by LIF so that the client does not suffer a loss, thus preventing a claim from arising. This benefits both the client and the lawyer and works to improve confidence in the legal profession generally.
A well-run, well-funded, and highly respected insurance program is an essential part of protecting the public interest in the administration of justice, and I’m very pleased with the excellent results LIF achieves. Lawyers and clients are well-served by this program, which is the envy of many jurisdictions.