Although the $1 million per error limit offers generous financial protection for the majority of claims lawyers face, this may not be enough to protect you and your firm. If a mistake in your practice might lead to a claim that will cost more than $1 million to defend and pay, you are both at risk. For instance, you might miss a limitation for a client suffering a significant brain injury from a car accident, prepare a tax plan that results in your client being reassessed by CRA or draft a contract that fails to give your client full value for the company just purchased. Without excess insurance, you, and potentially your partners, will start paying for that claim out of your own pocket as soon as our limits are exhausted.

Every year, we receive many reports of potential excess claims. You will want to talk to an excess insurance progam broker about buying additional coverage to protect yourself from the risk of claims that exceed the policy limits or are not covered. Excess insurance must be bought for the firm as a whole, not its individual lawyers. A broker can help you decide how much excess insurance may be appropriate for your firm, if any. Besides the financial consequences of just one mistake, other factors that will be considered include the frequency of large transactions and the potential liability for the mistakes of former partners. In addition, because excess coverage is generally triggered by discovery of the claim as opposed to when the work was done, you will also want advice on how long to carry excess so that you are protected when a claim is made.

Excess insurance can also "drop down" and respond to risks that our policy does not cover, usually subject to a deductible or self-insured retention. Learn about commercial insurance.