Choosing Your Defense Counsel Before a Claim Ever Arises

If your company has ever been sued, then you know how important it is to have qualified and experienced counsel handling your case. Besides experience and qualifications, knowledge of your industry and your company can be even more crucial.

Under the typical commercial and professional liability insurance policy, should a claim arise that is covered by insurance, the insurance company will appoint counsel to represent your company. You’ve paid the premium on the policy and now the insurance company must pay to defend the claim against you. Sometimes, however, the attorney assigned to your case by the insurance company may be someone that you have never met or possibly even heard of. This can be an unsettling scenario, but it may not be beyond your control.

In certain situations, you may be able to choose the attorney or law firm that is assigned to represent your company. While you can talk to your insurance representative about this after a claim arises, the most beneficial time to have this conversation is before the policy is ever issued. So, the next time your company’s insurance policy is up for renewal or you are shopping the market for a new policy, talk to the insurance company about including a special endorsement that specifically states that the insurance company pre-approves your chosen attorney or law firm to represent your company should a claim arise. Keep in mind that the insurance company’s approved hourly rates may be less than what some attorneys typically charge, but that can be easily worked out between the attorney and the client. In some instances, companies pay the difference between the insurance company’s approved hourly rate and the attorney’s standard rate. Other times, the law firm will agree to the lower hourly rate – yet another reason to develop a relationship with an attorney before a claim ever arises.

Take time to understand the options your company may have concerning the selection of counsel. While many things are beyond your control, the selection of counsel may be more in your control than you realize.