While holding professional indemnity insurance is a legal requirement for all lawyers with a current practising certificate, in-house lawyers are generally exempt from holding professional indemnity insurance except when they provide pro bono legal services.
Despite the general exemption to hold professional indemnity insurance, it does not preclude liability arising or claims being brought against in-house lawyers for negligence or breach of duty from the legal advice they provide. Directors and Officers Liability policies do not automatically extend to the professional services of in-house lawyers, and some even expressly exclude this advice from the scope of coverage.
As such, many in-house lawyers choose to take out their own professional indemnity insurance to mitigate the risk of potential claims against them in instances where they are not covered by their employer's insurance policies. In some instances, in-house lawyers can pay up to $2000 per annum to obtain their own professional indemnity insurance coverage.