Professional Liability Insurance
Responding to malpractice and E&O claims
Professional liability claims often start with a demand letter or lawsuit alleging your professional services caused harm. Quick, proper response is critical to a successful defense.
Professional liability claims differ from general liability in that they allege failure of your professional judgment or performance—not just accidents. Many claims can be avoided or minimized through early intervention.
Step-by-Step Claims Process
Recognize potential claims early
Any client complaint, demand for refund, or threat to sue should be reported. Don't wait for formal legal action—early reporting allows early intervention.
Tip: Report any "circumstances" that might give rise to a claim, even if no demand has been made.
Report to your insurer immediately
Contact your E&O carrier as soon as you're aware of a potential claim. Claims-made policies require reporting during the policy period or you may lose coverage.
Tip: Your policy likely requires reporting of potential claims—read the notice requirements carefully.
Preserve all documentation
Gather all files, emails, contracts, deliverables, and communications related to the engagement. Don't alter, delete, or destroy anything.
Tip: Send yourself a detailed memo of events while memory is fresh. This helps your defense later.
Work with assigned counsel
Your insurer will assign defense counsel experienced in professional liability. They'll review the claim and develop a defense strategy.
Tip: You may have input on attorney selection. Ask about counsel's experience with your profession.
Participate in defense and resolution
You'll work closely with your attorney on discovery, depositions, and strategy. Many claims settle through negotiation; few go to trial.
Tip: Your consent may be required for settlements. Understand your policy's "consent to settle" clause.
Tips for a Smooth Claims Process
- Never communicate directly with the claimant after a claim is filed—let your attorney handle it
- Don't admit fault or offer to "make it right" without insurer approval—this can compromise your defense
- Continue professional services carefully—you may have ongoing obligations despite the dispute
- Review your engagement letters and contracts—they're often central to professional liability claims
- Consider whether mediation might resolve the dispute faster and with less damage to relationships
Need help with your professional liability insurance?
Our licensed agents can help you understand your coverage options and find the right policy for your business.