Attention Dewey & LeBoeuf lawyers

Issue Summary:

We help individual lawyers (and groups of lawyers) who work at law firms facing bankruptcy purchase insurance policies to cover their professional liability exposure that will remain with them personally beyond their current employment.


An attorney’s professional liability exposure is personal.  Under normal circumstances, law firms provide ongoing coverage for its lawyers for legal work done at the firm.  Absent any firm assets or insurance policies in place, the individual lawyers will likely be held personally responsible for defensive legal fees and any settlement or judgments for any malpractice they are alleged to have committed.

Professional liability insurance policies are claims made in nature.  Coverage will be provided by the insurer that is in place at the time of the claim.  When law firms are facing bankruptcy there is a cloud of liability insurance uncertainty as to if the firm has insurance currently in place, for how long it will be in place, and if a long term tail will ever be executed for the lawyers who work at the firm.  The large law firms that have entered bankruptcy over the past years have a spotty history of providing this coverage on a long term basis.

The Solution: Individual (Small Group) Tail Insurance

Anyone who worked at any time at the bankrupt firm should inquire about this coverage.  Even if the lawyers have not recently been employed at the firm, absent this solution under discussion, there will not be any coverage for the previous legal work when they were employed by the firm.  Professional liability claims lag the actual legal work completed by 2-4 years.

Why Now?

The lawyer’s marketability to move to another law firm is significantly impaired by the uncertainty of future liability claims.  The individual tail insurance will give the new firm a sense of security that the lawyer will not be distracted by uncovered claims.

There is tremendous anxiety for lawyers who want to close this chapter of their careers.  The long process of unwinding the firm or bankruptcy proceedings will drag on for months if not years.  This product returns the control and certainty of the situation back to the individual lawyers.


Each lawyer (or group) must complete an application that describes their areas of practice, claims history, revenues, etc.  We will then submit these applications to our approved insurance companies who understand the unique exposures that we are discussing.


Won’t my new firm provide me with professional liability insurance?

Common practice in the legal industry is that the new firm will only cover you for legal work as of the date you join the new firm.

What is the downside to purchasing the individual coverage?

The premiums might be significant depending on the exposure and experience of the lawyer being underwritten.

What if the bankrupt law firm does purchase a firm-wide tail policy in the future?

Even if there is a tail purchased at some date in the future, it will likely include a large deductible unsuitable for individual finances.  The individual policy may be able to cover that exposure and here may not be sufficient insurance limits available to the lawyer in the future.

Who are we?

Risk Strategies Company is a regional insurance broker specializing in insurance and risk management solutions for law firms. Contact Uri Gutfreund 212-826-9744.

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