Starting July 1, 2025, WILMIC has begun offering a new endorsement option for policyholders – the Expense Outside of Limits endorsement. This new endorsement can provide critical financial coverage to attorneys defending themselves against legal action. Attorneys and firms can contact WILMIC to discuss the benefits of an Expense Outside of Limits endorsement and discuss adding an endorsement to a new or existing malpractice liability policy.
What Is the Expense Outside of Limits Endorsement?
WILMIC’s new Expense Outside of Limits (EOL) endorsement covers a policyholder’s legal defense costs outside of their liability limits. When a policyholder purchases the endorsement, WILMIC will pay claim expenses separately from the liability coverage limit. The EOL endorsement can provide up to 10 percent of a policyholder’s per-claim limit for defense costs (with a cap of $250,000), allowing policyholders to preserve their liability coverage to pay settlements and judgments. For example, a policyholder with a $250,000 liability policy can receive an additional $25,000 for defense costs with an EOL endorsement.
Why This Endorsement Matters for Legal Professionals
EOL endorsements can provide critical financial protection for attorneys and law firms. Legal malpractice claims can involve significant defense costs, especially when claims arise from complex client matters or a malpractice lawsuit leads to “trial-within-a-trial” litigation. An EOL endorsement can help an attorney or law firm avoid dipping into their liability coverage for defense costs, leaving more coverage available for a settlement or judgment, or prevent the need for a practitioner or firm to spend their financial resources to defend against a malpractice claim. EOL endorsements can preserve more of a lawyer’s or firm’s liability coverage to pay a settlement or judgment in a malpractice lawsuit.
Common Scenarios Where EOL Becomes Crucial
Examples of situations where practitioners can benefit from an EOL endorsement include:
- Complex litigation involving multiple defendants and expert witnesses
- Malpractice lawsuits that go to trial, which can significantly increase defense costs
- High-stakes cases that require firms to hire specialized legal or public relations consultants
- Cases where a practitioner needs significant effort from their defense counsel to obtain a favorable settlement
These scenarios can cause defense costs to pile up quickly. Without an EOL endorsement, a practitioner may need to significantly deplete their liability coverage or financial resources to defend themselves against a malpractice claim.
How to Evaluate Whether Your Practice or Firm Needs an EOL Endorsement
Factors that practitioners and law firms should consider when evaluating whether to add an EOL endorsement to their liability policy include:
- The size and risk profile of the firm, including the number of attorneys working at the firm and the areas of law the firm practices in – larger firms may incur malpractice claims more frequently due to their higher volume of work, or practicing in more complex areas of law may increase the risk of malpractice claims
- The nature of the firm’s clients – will the types of clients the firm works with have a greater chance of filing a malpractice claim after an adverse outcome to the clients’ case?
- How the firm’s policy currently handles defense costs, including applicable limits or sublimits
- The firm’s financial resources and ability to absorb defense costs, malpractice settlements, or judgments
- The additional premiums required to purchase an EOL endorsement
The team at WILMIC can help you or your firm understand how an EOL endorsement will work with your policy and the costs of adding an endorsement.
Contact WILMIC Today
If you’re concerned about how defending against a legal action may affect your malpractice policy limits, an EOL endorsement can provide you with the financial support you need. Contact WILMIC today for more information about our new Expense Outside of Limits endorsement and add the endorsement to your malpractice policy.