2013 marks the twenty fifth anniversary of ISBA Mutual Insurance Company. However, the factors which created our company go back to the early 1950′s. At that time, the Illinois State Bar Association became one of the first state bar associations in the United States to sponsor a program of professional liability insurance for its members. The insurance program was offered through a major commercial insurance company. This sponsored program of lawyers professional liability insurance continued for a period of about 35 years with relative stability.
However, in the mid 1980′s, lawyers throughout Illinois, including those insured under the ISBA’s sponsored program, began experiencing significant premium increases. Many ISBA members received premium increases of approximately 300% in a single year, even though they had reported no claims. At that point, the leadership of the Illinois State Bar Association decided that lawyers should consider forming their own insurance company with the objective of bringing stability to the lawyers professional liability insurance market in Illinois.
A task force was formed to seriously investigate the formation of our own company. The task force’s efforts indicated that the severe premium increases which had recently been experienced were not justified, based on our loss experience. The task force determined that we could lower premiums by approximately 30% by forming our own company.
The report of the task force recommending the formation of a lawyer-owned insurance company was approved almost unanimously by the ISBA Assembly at its December, 1987 meeting, and efforts toward the formation of a company were immediately undertaken. A goal was established to raise $3.5 million in capital in order to start the company. The effort to start the company was launched under the theme “Take Control.” Lawyers throughout the state rose to the challenge and contributed capital to start their own company. The company was incorporated on June 14, 1988, the necessary capital was raised, and our first policy was issued on December 1 of that year.
As promised, our premiums were about 30% below those then being charged by commercial carriers. The commercial market quickly reduced their premiums to be competitive with our lawyer owned company. ISBA Mutual has achieved its objective of stabilizing rates. Not only have ISBA Mutual’s rates remained stable, but we believe that our presence in the marketplace has caused rates charged by commercial carriers to remain stable as well.
ISBA Mutual was organized as a company of lawyers, by lawyers, and for lawyers. Our company is governed by a 21-member Board of Directors, all of whom are practicing lawyers insured by ISBA Mutual. Board members are elected from Appellate/Supreme Court Districts in Illinois, thus insuring a geographic representation throughout the state.
Since the beginning of our Company, the President of the Illinois State Bar Association has frequently served a one year term as Chairman of our Board of Directors the year following his/her presidency of the ISBA. Ten ISBA Mutual Board members are former Presidents of the ISBA. Several other ISBA Mutual Board members are present or former members of the ISBA Board of Governors. Our President and CEO, Jon W. DeMoss, is also a former ISBA President. ISBA Mutual has been the Illinois State Bar Association’s sponsored provider of professional liability insurance since its inception.
ISBA Mutual remains committed to providing quality insurance to Illinois lawyers at affordable prices. Any success enjoyed by our company will ultimately benefit our policyholders. Our company has held the line on premiums, we have experienced growth every year since 1988, and almost all of the lawyers insured with us remain loyal to our company. In the last few years, we have undertaken an extensive loss prevention program designed to help our policyholders avoid claims. We currently offer coverage limits of up to $15 million.
As ISBA Mutual begins its twenty third year of service to Illinois lawyers, we look forward to continuing to honor the principles on which our company was founded. We will continue to provide the best possible insurance protection at the most affordable prices consistent with long term stability. We will help our policyholders avoid claims and provide them with the best possible representation when claims arise. We will continue to keep the best interests of Illinois lawyers as our primary objective.
ISBA Mutual is rated A (Excellent) by A. M. Best.