PLF Policy 3.620

Extended Reporting Coverage

Extended Reporting Coverage (“ERC”) is subject to amendment or termination by the Board of Directors at any time. No rights are vested as to ERC (including rights as to the cost or scope of coverage) until such time as an OSB licensee has obtained ERC.

(A)          Definitions:
               
                (1)          Regular Coverage means the current PLF Primary Coverage Plan maintained by OSB licensees engaged in the private practice of law.

                (2)          Retirement means the “last act” in private practice in Oregon which would require an OSB licensee to maintain current PLF coverage under applicable PLF statutes and policies, whether the OSB licensee retires, dies, leaves private practice, or begins private practice in another state after such date.

(B)          Time When Extended Reporting Coverage Takes Effect: An OSB licensee’s ERC takes effect as of the first day of the next calendar month following an OSB licensee’s date of retirement. ERC will be governed by the terms and conditions of the PLF Primary Coverage Plan in effect in the year of retirement.

              Example: Licensee retires on August 31, 2020. The ERC would take effect for covered claims first made against the licensee on or after September 1, 2020. The 2020 PLF Primary Coverage Plan would apply to all ERC claims.

               Example: Licensee retires on January 4, 2021. Licensee must obtain regular 2021 coverage. ERC takes effect on February 1, 2021. The 2021 PLF Primary Coverage Plan would apply to all ERC claims.

               Example: Licensee retires on December 31, 2020. ERC takes effect on January 1, 2021. The 2020 PLF Primary Coverage Plan would apply to all ERC claims.

(C)          Cost of ERC: There is no cost for ERC. ERC is granted automatically to OSB licensees who stop maintaining coverage under the PLF Primary Coverage Plan. However, ERC is not granted to OSB licensees who are in default in payment of any amounts due to the PLF.

(D)          Limits of Coverage: An OSB licensee who obtains ERC does not obtain new Limits of Coverage as defined at Section I of the PLF Primary Coverage Plan. Instead, the OSB licensee obtains ERC based upon the PLF Primary Coverage Plan in effect during the last year of coverage. This means the Coverage Period during the last year of regular coverage is extended to a single lifetime Coverage Period for the OSB licensee. The defense and indemnity costs for claims made during the last year of coverage will reduce the Limits of Coverage available to the OSB licensee for claims made in the years after retirement, when ERC is in effect. There is no coverage for claims based on acts, errors, or omissions which occur after the ERC has commenced.

               Example: OSB licensee retires on August 31, 2020. All covered claims made against the OSB licensee after that date will be covered by the OSB licensee’s ERC. When ERC takes effect on September 1, 2020, the reporting period for the OSB licensee’s regular 2020 coverage will be extended to a single lifetime reporting period commencing September 1, 2020. All claims made in 2021 or later years would fall within this single lifetime reporting period, and would be subject to all terms and conditions of the 2020 PLF Primary Coverage Plan and limited to the remaining Limits of Coverage available under the 2020 PLF Primary Coverage Plan.

               Example: Same facts as in the preceding example. The OSB licensee had one claim made in May, 2020 which was closed in 2021 with a combined defense and indemnity cost of $85,000 (including the licensee’s entire Claims Expense Allowance). Assuming the 2020 Limits of Coverage were $300,000 plus a Claims Expense Allowance of $50,000, only $265,000 in coverage remains available for all claims made during the balance of 2020 or in 2021 or later years (when the ERC is in effect).

(E)          Conversion of Regular Coverage to ERC During the Plan Year: A prorated refund of an OSB licensee’s PLF assessment may be available under the provisions of PLF Policy 3.400 if an OSB licensee leaves private practice in Oregon during the Plan Year.

(F)           Filing Request for Exemption After Becoming Exempt from Coverage: An OSB licensee who retires but remains an active OSB licensee will receive a PLF Billing Statement each year and should complete a Request for Exemption annually. If the OSB licensee does not file a Request for Exemption or other request for ERC within three months after the end of the last PLF Primary Coverage Plan year for which the OSB licensee has regular coverage, the PLF will automatically grant ERC. No ERC will be granted if the OSB licensee has other insurance coverage which applies to the claim. ERC applies only to claims arising from acts in the private practice of law which occurred during a period of regular PLF coverage as provided in the applicable PLF Primary Coverage Plan.

                Example: OSB Licensee retires on December 31, 2020. The OSB licensee is granted ERC upon filing a Request for Exemption from Primary Coverage (which should be filed by the default date of January 10, 2021).

                 Example: Same facts as prior example. OSB Licensee fails to file a Request for Exemption by the default date (January 10, 2021). If the OSB licensee does not correct this oversight, the OSB  licensee will eventually be suspended. However, even if the OSB licensee takes no action and is suspended, the PLF will grant ERC on April 1, 2021, effective January 1, 2021. The ERC based on the licensee’s 2020 PLF Primary Coverage Plan will apply to claims first made on or after January 1, 2021 arising from the OSB licensee’s private practice of law prior to 2021.

                  Example: OSB Licensee has 2020 PLF Primary Coverage, but does not either pay for 2021 coverage or request exemption by the January 10, 2021 deadline. A claim is made against the OSB licensee in February, 2021 based on an alleged error occurring in October 2020. Because the OSB licensee has not obtained PLF Primary Coverage in 2021, the PLF will provisionally apply ERC to the claim. If the OSB licensee obtains PLF Primary Coverage in 2021 by the final date for obtaining the coverage, the 2021 PLF Primary Coverage Plan will apply to the claim; otherwise, ERC will apply to the claim. If the OSB licensee fails to act within the time limits prescribed, the OSB licensee’s license may be suspended but ERC based on the OSB licensee’s 2020 PLF Primary Coverage Plan will apply to the claim.

                   Example: OSB Licensee retires on December 31, 2020 and commences practice in California on January 1, 2021. OSB licensee obtains malpractice insurance in California which covers new claims from the OSB licensee’s prior practice in Oregon. A claim is made on June 15, 2021 based on the OSB licensee’s prior practice in Oregon. ERC does not apply to
the claim.