Fatal deadlines · compulsory cover · secondary roles
Professional indemnity insurance (BAV) for a self-employed solicitor
In legal practice the most common mistake is also the least arguable: a deadline that expired. The case can then no longer be won, only paid for.
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Deze pagina in het Nederlands: Beroepsaansprakelijkheidsverzekering voor een zelfstandig advocaat.
The calculator and the quote form below are in Dutch. Prefer to do this in English? Email info@finassverzekert. nl or call 072 - 509 24 56 and we will take it from there.
Work out for yourself what it would cost.
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- We compare the offerings of several insurers
- An adviser checks whether the cover suits your activities
- We arrange the switch, including cancellation
A premium indication, not personal advice. Prefer to talk it through? Call 072 - 509 24 56.
In brief
For lawyers, professional indemnity insurance is not optional: the professional rules of the Nederlandse orde van advocaten (the Dutch bar association) require adequate insurance and set minimum requirements for it, including for the sum insured and the run-off period after the practice ends. If you set up on your own, this is the first thing to have in order, even before your registration with the Kamer van Koophandel (the Dutch chamber of commerce).
The loss you can cause is pure financial loss: the amount your client misses out on because of your mistake. The classic case is an expired appeal or limitation period, but it is just as often a forgotten letter interrupting limitation, a right of annulment not invoked, an attachment not followed in time by a claim on the merits, or a settlement whose consequences were not fully explained. The standard is set out in Article 7:401 of the Dutch Civil Code: you must exercise the care that could be expected of a competent lawyer in the same case. Losing a case is not in itself a mistake.
What matters for a sole practice is the description of your insured capacity. If you act as insolvency practitioner, administrator, mediator, arbitrator, director or supervisory board member, those are roles other than that of lawyer, and many policies do not cover them automatically. Have each secondary role stated separately on the policy schedule, or arrange separate cover for it.
This page deals with one situation. The full overview is on Compare professional indemnity insurance (BAV).
What to look out for
Four points that make the difference in a sole legal practice.
Monitoring deadlines with no back-up
With no secretariat or office colleague you are the only checkpoint. Enter every fatal deadline in two systems, plan a check well before the date and agree with a colleague who takes over your diary if you fall ill. An expired appeal period leads to an argument about the chance that the appeal would have succeeded, not about the mistake itself.
Secondary roles mean wearing a different hat
As an insolvency practitioner or administrator you do not act on a client's instructions but on the basis of an appointment, with its own liability regime. A board or supervisory role falls under directors' and officers' liability. Declare them all; what is not declared is not covered.
Client account money and payments
Mistakes in handling client account money are rarely a professional error in insurance terms. Loss through misappropriation, fraud or a forged payment instruction falls outside this policy and calls for a fraud or cyber cover. Always check changes of account details by telephone on a known number.
Disciplinary matters, fines and your own intent
A complaint to the deken (the local bar president) or the disciplinary tribunal is not a claim for compensation; the disciplinary sanction and any fine remain excluded. Also intent and wilful recklessness are as well, under Article 7:952 of the Dutch Civil Code. Defence in disciplinary cases can sometimes be insured as a separate module.
What does your premium depend on?
- Annual turnover of the practice: the usual basis for a one-person firm
- Areas of law: property, finance and corporate law weigh more heavily
- Secondary roles: insolvency practitioner, mediator or supervisory board member increase the risk
- Sum insured: per claim and per insurance year, with a minimum set by the professional rules
- Retroactive period: for files from a previous employment
- Claims history: including circumstances notified without a claim
Insurers weigh these details differently. That is where your saving is.
What is covered
| Situation | AVB | BAV |
|---|---|---|
| A forgotten letter interrupting limitation lets your client's claim become time-barred | No | Yes |
| You fail to explain the tax consequences of a settlement and your client is left with less | No | Yes |
| An opposing party holds you liable because you stated incorrect facts about him in a pleading | No | Provided that |
| Your client loses the case although the file was handled correctly | No | No |
| A client trips over a loose skirting board in your home office | Yes | No |
| Files are lost in a leak at the premises you rent | No | No |
Losing a case is not in itself a professional error. Only a risk you failed to identify or a missed deadline makes it one.
Frequently asked questions
This is what people ask us most.
I am setting up on my own after years at a firm. Is my past covered?
Only if you arrange it. The work you did as an employee fell under the firm's policy. That cover stops for new notifications as soon as you leave, unless the firm continues to treat you as a former employee. Ask for written confirmation and discuss with your own insurer which retroactive date it applies. Any gap between the two dates is yours to carry.
A client says I was too optimistic about his chances in court.
Advice on the chances of success is an undertaking to use best efforts, not a guarantee. Liability only arises if you failed to identify a relevant risk or gave a wrong picture of the law. Your file is decisive here: confirm advice in writing, including advice given orally, and note which choices the client made after the alternatives were explained.
What happens to my cover if I close my practice?
The professional rules require you to remain insured for a number of years after closing for claims that still come in. You must arrange that run-off cover before the policy ends. Afterwards it is almost never possible. Discuss this when moving to another firm as well, because your own policy stops then too.
Am I insured when a colleague covers my cases?
That depends on the division of roles. If the locum takes on the engagement himself, his policy applies. If you formally remain the lawyer in charge, you remain liable for what happens in your file, including during your absence. Record the cover arrangement in writing and inform the client, so that it is clear afterwards who did what.
Read more
Within Beroepsaansprakelijkheidsverzekering
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