discuss this issue with your firm’s malpractice insurance representative
so options can be identified and reviewed well in advance of any
planned departure. That said, I can share that under two ALPS
policies, and as long as certain conditions are met, we provide some
of the most comprehensive tail coverage options in the industry, to
include free individual EREs in event of retirement, death, disability,
or a call to active military service.
Be aware the period in which one can obtain an ERE can be quite
limited. Most policies provide a 30-day or shorter window that will
start to run on the effective date of the expiration or cancellation of
the final policy. There are even a few very restrictive policies in the
market that require the insured to exercise the option to purchase an
ERE on the date of cancellation or expiration. Given this, you should
review relevant policy language well in advance of contemplating
departing the profession, as the opportunity to purchase an ERE is
one you can’t afford to miss.
The duration of tail coverage, or more accurately the length of
time under which a claim may be reported under an ERE, varies
depending upon what is purchased. Coverage is generally available
with a fixed or renewable one, two, three, four, or five-year reporting
period or with an unlimited reporting period. If available to you, the
unlimited reporting period would be the most desirable, particularly
for practitioners who have written wills during their later years of
practice.
The premium charge for an ERE is usually specified in the policy.
Often the cost is a fixed percentage of the final policy’s premium and
can range from 100 percent to 300 percent depending on the duration
of the purchased ERE.
Given all of the above, if the ERE provisions outlined in your policy
language have never been reviewed, now’s the time. One final thought,
be aware that if the unexpected ever happens such as the sudden and
untimely death of an attorney still in practice, know tail coverage
can be obtained in the name of the deceased attorney’s estate if
timely pursued in accordance with policy provisions. This is why even
attorneys who are not nearing retirement should still have some basic
awareness of ERE policy provisions, because one just never knows.
Disclaimer: ALPS presents this publication or document as general information only. While ALPS strives to provide accurate information, ALPS expressly disclaims any guarantee or
assurance that this publication or document is complete or accurate. Therefore, in providing this publication or document, ALPS expressly disclaims any warranty of any kind, whether
express or implied, including, but not limited to, the implied warranties of merchantability, fitness for a particular purpose, or non-infringement.
Further, by making this publication or document available, ALPS is not rendering legal or other professional advice or services and this publication or document should not be relied upon
as a substitute for such legal or other professional advice or services. ALPS warns that this publication or document should not be used or relied upon as a basis for any decision or action that
may affect your professional practice, business or personal affairs. Instead, ALPS highly recommends that you consult an attorney or other professional before making any decisions regarding
the subject matter of this publication or document. ALPS Corporation and its subsidiaries, affiliates and related entities shall not be responsible for any loss or damage sustained by any
person who uses or relies upon the publication or document presented herein.
FALL 2019
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