The Gazette 1991

g a z e t t e

a p r i l 1991

Mandatory Liability Fund -

An American Experience

Operation of America's only man-

datory liability fund for attorneys

has been detailed by Kirk R. Hall,

Chief Executive Officer of the

Oregon Professional Liability Fund,

in a paper of which the following is

a summary.

Founded in 1978, the Oregon Pro-

fessional Liability Fund is a man-

datory body covering all attorneys

in private practice in the State of

Oregon, approximately 5,200, and

provides malpractice coverage up

to an aggregate of $300,000 a

year. Coverage is provided on an

individual, not on a firm basis. The

cost of coverage in the current year

(1991) is $1,800 per attorney,

dropping to $1,700 next year. New

attorneys pay half the regular

assessment in the first year,

stepping up to full rate over four

years.

Attorneys with prior claims are

charged an additional amount for

their coverage in future years.

There is no surcharge for claims

which are defended or settled for

$10,000 or less, which is the great

majority of claims. For larger claims

the surcharge is equal to two per

cent of the total of defence and

indemnity costs in excess of

$10,000. The surcharge is paid

each year for five years.

Attorneys must obtain extended

coverage when they leave the

private practice of law. This cover-

age applies to claims first made

against the attorney after retire-

ment arising from actions occurring

before retirement.

Because Oregon has a mandat-

ory programme and the limits of

coverage are relatively low

($300,000 per claim) the Fund is

able to operate safely without

reinsurance.

Loss prevention is regarded as a

major achievement and $70 per

lawyer per year is spent on loss

prevention activities which em-

brace education by way of written

materials and workshops; in-office

assistance with law office systems;

alcohol and chemical dependency

counselling and i n t e r ven t i on;

stress, burnout, and career change

counselling and intervention. Audio

cassette programmes are supplied

to lawyers free on request. Hand-

books on malpractice are mailed

free to all members. Three staff

members travel around the State

working with lawyers on a con-

fidential basis on matters related to

loss prevention. This programme is

independent of the Bar and does

not report information to the Bar

discipline staff.

When claims are made they are

handled primarily by staff attorneys

with several years' experience in

private practice. Independent

lawyers are employed for cases in

actual litigation. Only 45 per cent

of claims go into litigation, and the

plaintiff wins a verdict in only 7 per

cent. More than 55 per cent of

claim files are closed without any

payment or indemnity. Of the

5,200 lawyers in private practice in

the State of Oregon approximately

half carry additional malpractice

coverage above the $300,000

limits. Starting this year (1991) the

Oregon Professional Liability Fund

will offer excess coverage to firms

on an optional underwritten basis.

Firms will be able to obtain aggre-

gate coverage up to $5 million at

rates significantly lower than those

charged by commercial carriers.

The programme will be reinsured

through Lloyds of London and other

reinsurers, and will be financially

separate from the mandatory

primary fund.

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During 1990 the Irish Kidney Association's Donor

Awareness Programme helped 200 people suffering

Kidney, Heart and Liver failure to receive a second

chance for life.

The Irish Kidney Association could not carry this life-

saving work without the help of informed caring members

of the community - such as the legal profession.

Finance received through bequests/donations has

enabled not only educational and research programmes

but also the purchase of life-saving equipment for

hospitals nationwide.

The Irish Kidney Association is proud of its record of

treating people from all walks pf life and from all parts of

the country as equal beneficiaries of its services.

IRISH KIDNEY ASSOCIATION

Donor House, Ballsbridge, Dublin 4.

Ph: 01-689788/9

Fax:01-683820

Registered in Ireland, No:

66109

Chy No:

6327

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