LawPRO wants licensees to get serious about cybercrime, by restricting insurance coverage in that area, and changing the requirements for paralegals who partner with lawyers.
LawPRO is instituting a $250,000 cap for claims related to cybercrime, such as misappropriation of client trust funds or breaches of confidential information. In doing so, it says it’s telling lawyers and law firms to get more serious about preventing cybercrime.
Exposure of the insurance program to large losses arising out of cybercrime, and the potential for clusters of such claims across law firms, prompted the change. LawPRO is encouraging licensees to be aware of their exposure and better protect their client data, their trust funds, and themselves, according to the LawPRO report on insurance changes for 2014.
Paralegals practising in partnership with lawyers will have to renew with coverage that matches their lawyer partners’. LawPRO is holding the base premium at $3,350 for 2014.
There has been a spate of recent attempts at bogus cheque scams sent by e-mail to law firms.
In its report to Convocation, Sept. 25, the insurer says most professional liability policies do not provide coverage for losses resulting from crime. Cyber liabilities are often excluded in lawyers’ policies. “The LAWPRO professional liability policy has always been more generous than the market norm for both crime and cyber risks,” the report notes.
Cybercrime coverage will be capped at $250,000, “a limited amount that provides some protection but will need to be supplemented by a vigorous risk management program on the part of law firms,” the LawPRO report states. “The legal community, like all businesses and individuals, needs to become serious about cyber security.”
Coverage will be accompanied by a focused education program.
October is Cyber Security Awareness Month in Canada.