Are you vicariously liable for legal malpractice committed by other lawyers in your Firm? 

Are you vicariously liable for legal malpractice committed by other lawyers in your Firm? Not if your Firm meets these requirements.

Illinois Supreme Court Rules 721 and 722 allow lawyers in Illinois to protect themselves against vicarious liability for legal malpractice committed by other lawyers at their firm provided that the law firm:

  1. Is organized as a Limited Liability Entity (doing business as a corporation, association, limited liability company or registered limited liability partnership), AND
  2. Maintains the minimum amount of malpractice insurance
    • “Minimum” is further defined as, “a professional liability insurance policy applicable to a limited liability entity, and any of its owners or employees, for wrongful conduct.” Minimum insurance must exist, “in one or more policies, with respect to claims asserted during an annual policy period due to alleged wrongful conduct occurring during the policy period and the previous six years.” The minimum amount of insurance is “$100,000 per claim and $250,000 annual aggregate, times the number of lawyers in the firm at the beginning of the annual policy period.

Alternatively, an Illinois law firm may enjoy limited liability status by submitting proof of financial responsibility. To do so, it must evidence funds equaling at least the minimum required annual aggregate for minimum insurance referenced above. Proof of such funds may be in any of the following forms:

  1. Deposit in trust or in bank escrow of cash, bank certificates of deposit, or United States Treasury obligations;
  2. A bank letter of credit; or
  3. A surety bond. These funds must be “specifically designated and segregated for the satisfaction of any judgments” against the law firm.



ISBA Mutual insures more lawyers in Illinois than any other insurance company. Find out why we are different and the additional services we provide to support our policyholders and the legal profession.

We don’t work with insurance agents or brokers. We work directly with our policyholders. Contact ISBA Mutual Insurance Company directly to discuss how we can provide you with peace of mind and adequate coverage for you and your law firm.