Today’s Law Firm Risk Management Challenges - Huntersure

Today’s Law Firm Risk Management Challenges

Posted on: February 13, 2020 by Huntersure LLC.

Law firms of all sizes and all specialties face the risk of being sued every single day. Former clients and even current clients may feel they have a case against a firm and its partners, and most of the time, the claims that get attention are those related to malpractice or negligence.

But while these claims are very much a real threat to legal professionals on a day-to-day basis, there are many other risks they face when it comes to being on the receiving end of a lawsuit.

Having good risk management and knowing what you’re up against can help to limit risks and cut down on liability exposure. A solid risk management plan is something that lawyer liability insurance agencies look at when insuring a potential client in the legal field, whether it’s a one-man shop or 100-person firm.

Here’s a look at some of the challenges that law firms face when it comes to risk management plans.

Risks with Clients

When someone becomes a client of a firm, the risk management process should be set in motion. Lawyers on the team need to look at whether the client’s matter is within their scope of expertise. For instance, if someone has a dispute over their estate, it may not be the best choice for the lawyer(s) to look into securities issues. Every attorney on staff needs to identify their area of expertise and only take on clients in those specific areas.

Next, an attorney must be able to assess whether or not they have the available resources in order to take on a certain case. By taking on a client with limited resources or during a busy schedule could open up the door to major issues like missing deadlines, exposing the firm to risks.

Also, an attorney would be wise to consider whether there are any conflicts of interest with a potential client. There needs to be stringent conflict of interest protocols in place in order to avoid risks related to this issue. Every firm should be thinking of its future as the larger a firm gets, the bigger the potential is for conflicts of interest.

Risks with Other Lawyers

Lawyers make mistakes too and can end up costing them their future as a legal professional or at least put a big dent in their reputation and possibly the reputation of the firm they represent. Some attorneys feel they can take on a case alone instead of delegating within their firm. That’s when the potential for major conflicts and risks rise.

Having new attorneys join a firm may also present a risk when it comes to risk management. A major issue is that an attorney may not be the right fit for a case and end up investing in it personally over time, which can have negative effects on the case overall. Or new attorneys may not have explained in full why they left their previous firm, hiding truths that would be pertinent to understanding their motives or integrity.

How to Cut Down on These Risks

Law firms and those who run them can eschew the potential for liabilities and major claims being brought against them by being educated and proactive about keeping everything above board and responsible.

First, they should implement or update policies and procedures they operate under every day. Firms should review their procedures and see where they can be more strict. Risks change on a regular basis and each practice should be able to change as well.

Also, attorneys should encourage training and education for other attorneys on staff and employees in the firm. Continuing education and professional development is a critical part to keeping everything updated and everyone aware of potential risks.

Posted in: Lawyer's professional liability insurance legal liability