Demand Letter
A letter from a client or their lawyer asking you to pay for a loss they blame on your work. It is often the first sign of a claim.
What it means for your firm
Many professional liability policies count a written demand for money or services as a claim, even before a lawsuit is filed. Check how your policy defines a claim.
Claims-made policies usually require you to report a claim to the carrier during the policy period, so a demand letter should be reported promptly.
Avoid admitting fault or offering a settlement on your own. That can affect how the policy responds.
Guides that use it
General definition for education only. It is not an interpretation of any policy or contract, and it is not legal advice. The wording of your own policy and contract controls. Policies and definitions vary by insurance company.
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Starting out or renewing, with a policy in hand or not. If something is worth discussing, we’ll call. If not, we’ll say so.