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Professional Malpractice Fairness

FAIRNESS FOR PROFESSIONALS 

PROTECTION FOR CONSUMERS 

Thousands of licensed professionals help New Jersey residents resolve problems every day. These professionals are a huge part of their communities and drivers of the state’s economy.
 

But they often struggle to meet overhead expenses — one of the most costly, but important, is professional liability insurance. The NJSBA continues to advocate for a measure to provide critical stability and predictability to professional malpractice cases, protect consumers and put all professionals on a level playing field.

The measure is supported by representatives from the insurance industry, several county and affinity bar associations and other professional groups that believe it is important to level the playing field the legal community, in particular to young lawyers, solo and small-firm lawyers and those from diverse backgrounds.   

Key highlights include:

The time is now for fairness in professional malpractice.

The NJSBA proposal would:

  • Provide stability to the cost of doing business;
  • Reduce the statute of limitations to bring a malpractice claim against a professional to two years — similar to what it is for doctors and what it is for professionals in New York and Pennsylvania;
  • Give consumers two years from the date they reasonably discover a problem to file a malpractice claim;
  • Make New Jersey a more competitive place to do business for insurance companies;
  • Eliminate fee shifting in legal malpractice claims; and
  • Protect citizens by making professional liability insurance more accessible and more affordable to professionals.
 
WHAT IT MEANS FOR ATTORNEYS
 
The status quo is not viable.
 
Despite the fact that over 25 insurance companies the state Department of Banking and Insurance authorizes to write legal malpractice coverage, just a handful are actually writing and renewing policies.
 
The base rate for a New Jersey lawyer to get coverage starts at 49 percent higher than in New York and 33 percent higher than in Pennsylvania.
 
Because of the overly long statute of limitations, New Jersey has the highest number of claims in the region and exceeds the national average.
 
Meanwhile, New Jersey has fewer private practice attorneys than either of those neighboring states.
 
So what is making the New Jersey insurance market so restrictive? Two things: a statute of limitations for professional malpractice claims that is longer than the neighboring states and fee shifting.
 
The result is a restrictive insurance market and higher malpractice insurance rates for lawyers — most of whom work in solo or small firms that form the backbone of their communities and fuel local economies.
 
The measure would bring the statute of limitations in-line with neighboring states and eliminate fee shifting in professional malpractice matters, which would make the New Jersey insurance market place more attractive and would protect consumers. This will provide accessible and affordable coverage to those small business owners who need it most.
 
Click here to read the key findings of a New Jersey State Bar Association Report from the Working Group on Professional Malpractice.
 
ADDITIONAL RESOURCES
 
Check out legal malpractice data highlights New Jersey’s outlier status here.
 

Learn more about the New Jersey small business community here.

Read statements from small business owners on the hardships they face due to New Jersey’s restrictive insurance market here.

Read “Professional malpractice stability needed: New Jersey attorneys share their experiences” here. Read “OP-ED: Insurance Bill Would Be Fairer to Professionals, Protect Consumers,” NJ Spotlight here.

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