Mitigating Your Clients Financial Risk and More
Contract Litigation Insurance (CLI) was created by a team of experienced attorneys who know very well that a lawsuit is a complex and multifaceted process. In a contract lawsuit where there exists a “prevailing party” attorney’s fee provision, the uncertainties and the risk of financial loss are heightened. CLI was specifically designed to cover your clients from the possibility of having to pay their adversary’s attorneys’ fees – whether they are an individual, business or corporation, or a plaintiff or defendant. In addition to financial protection, a CLI policy offers a number of other important benefits to you and your clients.
Strengthen Your Client’s Position In Settlement.
An offensive negotiating posture, or a solid defensive positioning. Depending on which side your client is on, a CLI policy can serve as a strategic asset in settlement, since it removes the possibility of having to pay an adversary’s attorneys’ fees.
For plaintiffs, this can translate into greater negotiating power, perhaps even increasing the value of their settlement offer. For defendants, the coverage eliminates the adversary’s ability to leverage the risk of having to pay their attorneys’ fees, which may even afford a reduction in settlement payout. For both parties, it means being able to make better decisions when considering the pros and cons of a settlement offer.
In addition to protecting litigants from financial exposure and strengthening their position and negotiation posture in settlement, a CLI policy can help you provide your client with better budgeting certainty and expense forecasting.
Benefits To Your Client At A Glance:
- Reduces the financial exposure in litigation for plaintiffs or defendants
- Increases settlement negotiation power
- Provides better budgeting certainty and expense forecasting
- Strengthens your relationship with clients by demonstrating your commitment to advise and serve them well
- Underwritten by individual member companies of Zurich in North America
- Affordable premiums
Why You Should Discuss CLI With Your Clients.
There are many reasons why you should discuss CLI with your clients, but perhaps the most important one is that they expect you to. A recent consumer study conducted by the independent research firm Insite Research found that 82% of those surveyed indicated that they expect their attorneys to advise them of insurance that can minimize their financial risk in litigation. Which of course, is exactly what a CLI policy can provide.
Your clients will also want you to help them determine how much coverage they should obtain. CLI premiums are affordably priced; however, as a lawsuit progresses and the degree of uncertainty increases, so does the price of the CLI premium. Your clients will save on the cost of coverage by purchasing a policy as early as possible, such as the period between the initial case filing or service of the complaint for a defendant and the motion to dismiss/answer.
A Best Practice For You.
Although every litigator has his or her own style and technique, all are bound by ethical and professional responsibilities that come with practicing law. All strive to thoroughly assess the strengths, weaknesses, positions, arguments, possibilities and uncertainties of their clients’ cases.
In many ways, a CLI policy serves to support these and other important best practices, since it further helps attorneys protect their clients from financial risk. In addition, a CLI policy enables attorneys to meet their clients’ demand for budgeting certainty and, at the same time, demonstrates sensitivity to the financial strain of litigation. Indeed, making your clients aware of the benefits of Contract Litigation Insurance is one more way to exhibit your integrity and desire to advise and serve your clients well.
An Important Disclosure.
Much like provisions in retainer agreements that discuss possible insurance coverage for a client’s own attorneys’ fees, you may wish to inform clients in your retainer letters that insurance coverage exists that will cover them against having to pay an adversary’s attorneys’ fees if unsuccessful in litigation.
To find out more about the kind of disclosure language that can be included in your retainer letters, contact an agent by entering your zip code in the box to the right.
