Professional liability insurance—sometimes called malpractice insurance or errors and omissions insurance—is insurance that may be purchased by attorneys and law firms to pay the costs of defending legal malpractice claims, and the costs of settling such claims or paying the judgment awarded to a plaintiff on such a claim. Most states do not require attorneys to purchase professional liability insurance, but some states require attorneys who do not carry professional liability insurance to provide notice to their clients of that fact. Some states require attorneys to have their clients sign a written disclosure that the attorney does not have professional liability insurance.
In Massachusetts, attorneys are not mandated by state law to carry professional liability insurance, commonly known as malpractice insurance. However, the Massachusetts Rules of Professional Conduct require attorneys to inform a client if they do not maintain professional liability insurance of at least $100,000 per claim and $300,000 in the aggregate, per policy year, whenever they know or reasonably should know that the client expects the attorney to have such insurance. This disclosure must be made in writing at the time of the client's engagement of the attorney, or as soon thereafter as the attorney becomes aware of the lack of insurance. This requirement is intended to ensure that clients are aware of the risks involved in hiring an attorney without malpractice insurance and can make informed decisions about their legal representation.