Is Employed Lawyers Insurance Worth The Paper It's Printed On?

Employed lawyers insurance is often sold as an add-on to directors and officers liability (D&O) policies by insurance companies looking to add perceived value to a proposal. Typically, no or very little premium is associated with this kind of coverage. Such insurance often covers an in-house lawyer’s malpractice exposure to the corporation and other employees of the corporation. While this kind of claim is rare – what company wants to publicly excoriate its general counsel for mistakes in doing his or her job? – it does happen, and a corporate counsel’s exposure to this kind of liability is more than theoretical. Employed lawyers insurance may be more valuable to the corporate policyholder than the underwriter thinks.