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Lawyers Required To Take Out Insurance Cover


Lawyers, just like other professionals like doctors, insurance brokers, and consultants, are required to take out and maintain Professional Liability Insurance (PLI), also called Professional Indemnity Insurance (PII).

This is a form of liability insurance that helps protect professional advice and service-providing individuals and companies from bearing the full cost of defending against a negligence claim made by a client, and damages awarded in such a civil lawsuit. The coverage focuses on alleged failure to perform on the part of, financial loss caused by, and error or omission in the service by the policyholder.

PII is insurance that covers civil liability claims arising from lawyer’s work in legal practice. These claims usually involve professional negligence.

PII also increases lawyers’ financial security and serves an important public interest function by covering civil liability claims, including: certain related defence costs, and certain regulatory awards made against a lawyer by any complaints bureau.

It ensures that the public does not suffer loss, which might otherwise be uncompensated. This is important in maintaining public confidence in the integrity and standing of solicitors.

 

NBA’s group life cover for lawyers

Apart from the PII made compulsory law, the Nigerian Bar Association (NBA) has indicated its intention to collaborate with insurance company to provide insurance cover for legal practitioners in the country.

According to the NBA president, Augustine Alegeh, the insurance cover options proposed by the insurance firm include death or accidental permanent disability, accidental death, critical illness and accidental medical expenses.

He added that NBA members shall indicate their preferred option and would be provided with that option of cover by the insurance outfit for that year.

The NBA boss also informed that “The premium for this insurance policy shall be fully funded by the Nigerian Bar Association with monies realised from the payment of Annual Bar Practising Fees.

Consequently, this insurance policy shall only be available to lawyers who have paid their annual bar practising fees for the year in question.

All insurance claims shall be processed directly with the insurance company who shall provide the procedure to follow in processing such claims,” the NBA president noted.

 

Need for prompt claims payment

While the NBA must be commended for providing an insurance cover for its members, the insurer concerned is enjoined to provide the insured members all the needed cover and should not be found wanting in this regard.

In consideration of the fact that there would be no need to arrange insurance cover if claims will be not be paid when the need arises, the affected insurer must strive to settle all genuine claims promptly so as to retain the confidence of these legal practitioners who have voluntarily elected to arrange insurance cover for themselves. If, in any case, a claim is to be repudiated, such should be communicated politely to the affected insured within a reasonable short period of time.

By so doing, these lawyers will be the ones who will be helping to encourage other members of the insuring public to arrange insurance cover for themselves.

 

Other groups should emulate NBA

Although section 4(5) of the Pension Reform Act 2014 mandates employers with a minimum of 15 employees to arrange group life insurance for their employees, it is evident that this provision of the law will not be applicable to majority of the lawyers in the country as they usually engage in private practice. The fact that the NBA decided to arrange this group life cover means the association intends to improve the welfare of its members nationwide especially as this policy will cover accident, permanent disability and death.

As we live in a world of risks, it is only reasonable to prepare in advance should the unexpected happens. This is actually the essence of insurance. This initiative by NBA is definitely worthy of emulation by all groups and associations in the country so that their members and dependents can have something to fall back on in case of any eventuality.

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