New Malpractice Insurance Disclosure Requirement
The Washington Supreme Court in June 2021 approved an amendment to RPC 1.4: Communication that requires disclosure to clients if lawyers do not meet minimum levels of malpractice insurance coverage. The rule went into effect Sept. 1, 2021. The Washington State Bar Association encourages all Washington lawyers to review the requirements, get more information if they have questions, and ensure they are compliant.
Highlights of the New RPC 1.4(c)
- New RPC 1.4(c) is effective as of Sept. 1, 2021.
- Disclosure to clients required if the lawyer lacks the minimum level of insurance which is $100,000 per occurrence and $300,000 in the aggregate ($100K/$300K).
- Any lawyer who does not have insurance that meets the minimum level must, before or at the time of commencing client representation, provide written notice to the client and obtain written informed consent from that client.
- Similarly, if a lawyer learns (or reasonably should know) of a malpractice insurance policy lapse or termination, the lawyer must within 30 days either obtain a new policy or get written consent from each client in order to continue the representation.
Background & Resources
“Washington Supreme Court Enhances Malpractice Insurance Disclosure to Clients” (article with important compliance and historic information)
“New Rule 1.4 for Client Communication and Disclosure of lawyer Malpractice Status (RPC 1.4)” (information from the WSBA’s Professional Responsibility Counsel)
Lawyers Covered by the Rule
The new rule applies to all lawyers with an active status with the WSBA, emeritus pro bono status lawyers, and lawyers permitted to engage in limited practice under APR 3(g), i.e., visiting lawyers, and any other lawyers authorized by the Washington Supreme Court to practice law, unless they come within one of these exemptions:
- judges, arbitrators, and mediators not otherwise engaged in the practice of law
- in-house counsel for a single entity
- government lawyers practicing in that capacity
- employee lawyers of nonprofit legal services organizations, or volunteer lawyers, where the nonprofit entity provides malpractice insurance coverage at the minimum levels.
Notice Language that Satisfies the Rule
Under Rule 1.4(c) of the Washington Rules of Professional Conduct, I must obtain your informed consent to provide legal representation, and ensure that you understand and acknowledge that [I][this Firm] [do not][does not][no longer] maintain[s] [any lawyer professional liability insurance (sometimes called malpractice insurance)] [lawyer professional liability insurance (sometimes called malpractice insurance)] of at least one hundred thousand dollars ($100,000) per occurrence, and three hundred thousand dollars ($300,000) for all claims submitted during the policy period (typically 12 months). Because [I][we] do not carry this insurance coverage, it could be more difficult for you to recover an amount sufficient to compensate you for your loss or damages if [I am][we are] negligent. RPC 1.4(c)(2)(i).