Why Your Malpractice Insurance Application Must Be Strictly Accurate

Rescission following a claim is the worst case scenario, and there are two things about it that law firm managers need to keep in mind. Number one is that misrepresentation doesn’t need to be intentional to become grounds to rescind. Number two is that in the case of a legal malpractice policy that covers a multitude, any misrepresentation about one individual may become grounds for rescission of the entire policy – at least per California law and one recent state court decision in Illinois, and no doubt in many other jurisdictions, as well. This post from Dentons details the particular policy application questions that, if not answered accurately, are most likely to become the basis of a rescission claim. “The lesson is clear,” the post concludes. “The potential inconvenience of confirming the total accuracy of an insurance application is greatly outweighed by the potential consequences of an inaccurate application.”