THE NEW HAMPSHIRE BAR Association has established a subsidiary corporation to act as an insurance resource and to provide professional liability insurance for members.

Insurance coverage for professional liability, always a concern to practitioners, is becoming an increasingly important issue for two reasons. First, the insurance industry is currently entering a "hard" cycle in which coverage becomes more difficult to obtain and premiums may increase as insurers, for a variety of reasons, become more cautious. Many NH attorneys have already seen their premiums increase significantly on renewal. Second, the Supreme Court's Advisory Committee on Rules has unveiled a proposal to require that attorneys disclose to their clients whether or not they have professional liability insurance coverage. (See related rules article.)

Although the subsidiary, the NHBA Insurance Agency, Inc., will be financially independent and self-sufficient of the Bar Association, it will benefit all Bar members in several ways, said Jeannine L. McCoy, NHBA executive director. Among the advantages are:

• More responsive and effective service by focusing exclusively on the insurance needs of New Hampshire Bar members, particularly in times when coverage may become more difficult to obtain in the general marketplace;
• Commissions earned by the Bar's insurance subsidiary will benefit Bar members by generating revenue that, in turn, will be used for risk-management services and programs;
• Premiums and policy terms that are as comprehensive and affordable as possible in a tight insurance market;
• Risk-management services and programs that are locally based and New Hampshire-specific.

Peter Milnes, a well-known New Hampshire-based insurance consultant who will manage the agency under contract with the Bar, has been investigating potential carriers for the past few months. The Bar's agreement with the currently endorsed carrier, American National Lawyers Insurance Reciprocal (ANLIR), expires on July 1, 2002. The NHBA Insurance Agency has hired an experienced insurance professional who will soon be contacting ANLIR policyholders. (See contact box below.)

McCoy said that in addition to Milnes and others familiar with the insurance industry, she also consulted with officials from the Massachusetts Bar Association, which offers malpractice insurance through its own subsidiary. The creation of the NHBA Insurance Agency is part of a continuing effort to strengthen and improve the Bar's service to members.

"Andrew Dunn and the other members of the Bar's Group Insurance Committee have done incredible work over the years to bring the best liability options to Bar members, including the endorsement of ANLIR five years ago. The growing complexity and competitiveness of the insurance marketplace, and the crucial role insurance plays as a member need, led us to consider changes in the Bar's approach to insurance," said McCoy.

"We sought to develop a structure that would allow us to combine the expertise of local, objective insurance professionals with the focused service orientation of an agency by and for New Hampshire Bar members."

About a year ago, as the Bar began to evaluate its upcoming renewal of the ANLIR endorsement, Hanson-Armstrong ceased to function as the managing general agent for ANLIR in New Hampshire. Bar leaders began actively investigating how the Bar could exercise more oversight of the malpractice insurance it was recommending to members, and channel a portion of agency revenue to risk-prevention services for New Hampshire lawyers.

The Bar's continuing endorsement of ANLIR was further questioned in the wake of a recent announcement that the company's A.M. Best rating had been downgraded. According to a March 27 press release by A.M. Best, a nationwide authoritative insurance rating source, the financial strength of ANLIR's parent company, Reciprocal of America, was lowered from A-minus (excellent) to B-minus (fair). According to A.M. Best, ANLIR's parent company's capital strength had weakened due to factors associated with Reciprocal's insurance subsidiaries covering hospitals and nursing homes, but the rating downgrade applied to all of the company's subsidiaries, including ANLIR.

ANLIR's Board voted on April 13 to not continue offering attorneys professional liability insurance in the New Hampshire market.

According to ANLIR representatives, policies with New Hampshire Bar members and their firms that expire after July 1 will not be renewed, but ANLIR is committed to meeting its obligations to all policyholders during the duration of their contracts.

The Bar Association is committed to assisting all Bar members with obtaining the best available professional liability insurance coverage.

Contact the Bar Association at 224-6942 if you have questions about your liability coverage, whether your current policy with ANLIR or with any other insurer expires now or after July 1, the effective date of the termination of the Bar's ANLIR endorsement. The NHBA Insurance Agency stands ready to assist you with your coverage and placement issues.

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New Hampshire Bar Association
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phone: (603) 224-6942 fax: (603) 224-2910
email: NHBAinfo@nhbar.org
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