My Claim: Questions and Answers
This summary of LIF’s claims process for negligence claims and potential claims (Part A of the policy) is intended only to assist lawyers. The duties of both lawyers and the insurer are set out in the policy, and that wording governs.
Some of the questions answered in My Insurance Policy: Questions and Answers are also relevant to the claims process:
- When do I have to report a claim or potential claim to LIF?
- Are my reports kept confidential?
- What are the financial consequences if a claim is made against me?
- What are my duties as an insured?
To report a claim or potential claim, go to the Reporting Guidelines for Lawyers.
- I have just reported. What should – or shouldn’t – I do next?
- What do I tell my client?
- Can I keep acting for my client on this or any other matter?
- Why do I feel so bad?
- Once I have reported to LIF, what happens?
- What can I do to help in dealing with my claim?
- Will there be a black mark on my professional record with the Law Society if I report a claim?
- What if my mistake can be fixed?
- What if I need defence counsel?
- How will I be kept informed about what’s happening with my claim?
- What happens after my claim is resolved?
If you have been sued, make sure you take any steps immediately needed to protect yourself and your firm from any default proceedings.
Otherwise, it is best to hold off on taking further steps until we connect with you. This way, you won’t risk coverage by admitting liability, indicating that your insurance company will “take care of everything,” trying to fix or settle the matter or doing anything else that might prejudice our ability to manage the claim. If your client or former client contacts you, either directly or through a new lawyer, wait to respond until you have spoken to us. We will guide you through what to say, ensuring you meet your ethical obligations without jeopardizing coverage. We will answer questions such as: “Can I tell my client I’ve reported to my insurer?,” “Should I give my client my file?,” “Can I go ahead and try and fix this or settle it myself?” or “Can I say I’m sorry?.” If the matter is urgent, call us.
That will depend very much on the particular circumstances of your report. You may need to recommend independent legal advice, but you want to avoid admitting liability. An apology may be appropriate. As we will connect first (see above), we can help you work through what to say.
It depends. You may be in a conflict such that you are unable to do so, or it may be best for other reasons to refer your client to new counsel. We will help you work through these issues.
Probably because you want to serve your clients well and think you shouldn’t make mistakes. But no one can be perfect all the time, and that is one of the reasons you are insured. And remember that you are not alone. Statistically, you will make a mistake – or someone will say you have – that requires you to report to us every seven years or so. We have been through this with many other lawyers and can help you put the matter into perspective.
Our claims manager will review your report and, depending on the area of law, assign it to one of our experienced, knowledgeable claims counsel. Claims counsel are in-house lawyers who are on the front-line of managing claims and potential claims. They have all spent time in private practice and understand its rigours and challenges.
We first make sure coverage is in order (it usually is), and then work to determine the most appropriate strategy to manage the matter. The strategy will depend on a number of factors: Are you reporting an actual claim or your discovery of a mistake that might lead to a claim? Can steps be taken to fix the mistake or minimize the loss? Is a vigourous defence required or should we work towards a resolution? Is it best simply to “let sleeping dogs lie” and wait for further developments or take immediate steps?
Generally you can expect a phone call from claims counsel after you report, and you will receive a letter. We may need more information and will want to discuss next steps with you. We can also answer any questions, including what to say to your client.
You are a vital part of the process. Your knowledge of the client and the circumstances surrounding the claim will be of great assistance. And by helping us and any defence counsel appointed, you are also meeting your duties as an insured.
No. Unless there is evidence of fraud or theft, your report of a claim under your insurance policy is confidential and does not form part of your professional record.
You might think you can just go ahead and fix the mistake yourself. Please do not try. If you do, you run the very real risk of a coverage denial because of a late report.
Leave it to us and we will help make that happen. In fact, each year about 20 per cent of the reports we receive are successfully repaired.
We have ongoing relationships with various lawyers who have acted as repair counsel many times over, and will assist in choosing one with the appropriate expertise to act for the client on the repair. Once selected, the client usually agrees to the repair avenue outlined. In most cases in which the repair succeeds, the lawyer is able to continue acting for the client.
Costs your client pays trying to fix your mistake, such as the costs of repair efforts, can be claimed against you as damages. If the mistake can be fixed for less than your deductible, then you pay only that amount. If we must contribute, then the usual financial consequences of a paid claim apply.
You usually won’t, as most of the matters reported to us do not involve litigation. But if you do, we will either take care of you ourselves or retain outside counsel. We defend many claims in-house, including most small claims matters. We also appoint external counsel, selecting from defence counsel who are experienced in defending lawyers’ professional liability claims. Selection is done on a case-by-case basis, taking into account factors such as the area of law and the complexity of the matter. As with all insurers, LIF controls the defence of the claim. However, if you have any questions about our choice of counsel, we are happy to explain.
We are committed to keeping you in the communication loop. If you have been sued, you can expect defence counsel to keep you informed, although we invite your calls at any time.
If we paid a settlement or judgment on your behalf, the usual financial consequences will follow.
Regardless, you may need to keep your file material relating to the underlying matter for a period of time. If you are not sure how long that should be, your claims counsel can give you some guidance.