Malpractice insurance disclosure circulated for public comment

By Diane Curtis
Staff Writer

If a proposed new Rule of Professional Conduct is endorsed by the State Bar Board of Governors, attorneys will be required to notify their clients if they do not carry malpractice insurance.

Also under consideration is a new Rule of Court that would require attorneys to certify to the bar whether they are covered by insurance. The bar would then have to make publicly available the names of attorneys who are not insured.

The recommendations, proposed by a task force appointed by former bar President John Van de Kamp, were sent out for public comment last month.

Both proposed rules require California Supreme Court approval.

Task force chairman James E. Towery, a former State Bar president and former chair of the American Bar Association Standing Committee on Client Protection, said the recommendation to use both methods was unique among the 16 states that require disclosure but that task force members “decided there was merit in each of them.”

The indirect method of informing clients through the State Bar is beneficial because so many people have access to the Internet, Towery said. At the same time, he added, “clients who are most harmed” by attorneys without malpractice insurance are often those without easy access to the Internet.

California had a form of required insurance disclosure that began in 1992 and ended in 1999. Some opponents of disclosure have argued that it imposes too great a burden on solo practitioners, who don’t have the financial resources of large law firms.

The proposal also includes a provision for non-disciplinary administrative suspension for failure to comply with the rule of court. Government lawyers or in-house counsel who do not represent clients outside that capacity would be exempt from the insurance disclosure requirements.