I ran across a fellow personal injury attorney’s blog post pointing out that only one state, Oregon, requires attorneys to be covered by malpractice insurance. When you think about it, it’s amazing the other 49 states, including New York, do not require attorneys to carry malpractice insurance, especially personal injury lawyers who handle multi-million dollar claims for their severely injured clients. Can you imagine a surgeon not carrying malpractice insurance? Unheard of. Lawyers make mistakes, too, and their clients should be protected from that, just as doctors’ patients are.
I am not sure whether we need a law requiring all New York lawyers to carry malpractice insurance. But I do think we need, at the very least, a law requiring full disclosure. I think all uninsured New York lawyers should be required to disclose, on their letterhead or in some other prominent place, “we do not carry legal malpractice insurance”. Why? Because most clients see lawyers as “rich” professionals, and assume they have adequate insurance coverage, just like doctors do. If they knew the lawyer they were about to hire was “bare”, they might decide to choose another lawyer who is covered.
Here at Michaels & Smolak we sue lawyers for legal malpractice in New York. From our experience, we know that it is tough to collect on a judgment against an uninsured lawyer. These lawyers have no insurance for a reason; they can’t afford it because they are already in financial straits. Usually, they have multiple debts or judgments against them, little or nothing in the way of assets, and they may file for bankruptcy to protect themselves from their malpracticed clients’ lawsuits. We have seen this happen many times.