Missed Communications

Policyholder Advisor & Alert

PUBLISHED ON: June 11, 2007

The New Jersey Law Journal set off a bit of a brouhaha in March when it published an article titled, “Before You Blog, Check With Your Insurance Carrier.” The article stated that Chubb had refused to sell a malpractice policy to a law firm in New Jersey, reportedly because Chubb told the law firm that its blog would make the firm uninsurable. A blog (or web log) is a website where entries are frequently updated and generally appear in reverse chronological order, so the newest items are on top and given prominence. Many businesses, including professional organizations such as law firms, use blogs as part of their web-based marketing efforts, considering them to be a useful way to communicate with clients and potential clients.

Shortly thereafter, Chubb issued a clarification that was reported in the same publication, stating that many legal blogs would not create a problem. A spokesperson explained that most such blogs are informational, but a small percentage are advisory, creating a risk that an attorney-client relationship could be created, leading to potential liability. Chubb’s clarification is, somewhat ironically, available on Chubb’s website (albeit not on a blog).

Many but not all law firms, bloggers, and other policyholders were reassured by Chubb’s clarification. Some found the idea of increased liability for blogging a bit outlandish, while others believed that appropriate disclaimers might be effective. The law firm at issue was still waiting to meet with Chubb to resolve its particular situation when the NYLJ published its follow-up report.

This episode has relevance to policyholders, not just law firms and other professional firms. Remember that your idea of an increased risk might not match that of your insurance company. It can sometimes make sense to discuss new ventures with your carrier, as well as your own risk managers, legal team, and brokers. Further, Chubb and the law firm might have handled this without media exposure if they better communicated with each other once this issue arose. Communication only works if everyone understands each other.