Malpractice Claims Trends: Insights from the 2025 ABA LPL Study

Legal malpractice continues to evolve alongside technological, demographic, and societal shifts. The 2025 ABA Lawyers Professional Liability Spring Conference highlighted key national trends that every law firm should be watching. From the impact of aging populations to the growing role of artificial intelligence, the following are examples of the most pressing developments influencing claims in the legal profession today.

The Big Three: Trusts, Business Transactions, and Securities

Recent surveys, including one by Ames & Gough, confirm that legal malpractice claims continue to arise most frequently from three practice areas:

• Trusts and Estates
• Business Transactional Work
• Corporate Securities

These areas inherently involve complex, high-stake matters where even small errors can lead to substantial financial consequences. In fact, despite claims frequency holding steady, 2023 – 2024 saw legal malpractice payouts hit an all-time high. Some insurers reported individual claim payouts exceeding $100 million.

Cybersecurity: A Persistent and Evolving Risk

Cybersecurity continues to pose serious challenges for the legal sector. Social engineering, wire fraud, and related cybercrimes are not yesterday’s issues—they remain today’s threats and are expected to persist into the future. As law firms handle sensitive client information and manage large financial transactions, the need for robust cybersecurity protocols has never been greater.

Lawyers Mutual continues to see law firms with no cyber security insurance coverage, no systems in place to guard against cyber threats, and risky behavior by attorneys and staff resulting in cyber-attacks on law firms in North Carolina.

We have many risk management resources on our website, visit lawyersmutualnc.com. Talk with Adam Pierce at our subsidiary, Lawyers Insurance, to get a quote on cyber coverage.

The Silver Tsunami and the Great Wealth Transfer

The demographic shift created by aging baby boomers, known as the “silver tsunami”, is expected to reshape legal needs and malpractice risk. With 63 million Americans currently aged 61 to 79 and baby boomers holding over 50% of the nation’s home equity, the potential for legal disputes involving estate planning, property, and wealth management is increasing. Adding to this is the unprecedented $84 trillion wealth transfer underway, making meticulous attention to trust and estate planning more crucial than ever.

Remote Work and Its Implications

The pandemic-induced shift to remote and hybrid work has redefined the legal workplace. While many attorneys appreciate the flexibility, remote work presents unique liability risks in areas such as:

• Attorney training and mentorship
• Supervision and oversight
• Well-being and isolation
• Data security and privacy

I’m a firm believer that remote and hybrid work can be done safely. As the profession continues to adapt to these new models, firms must redesign their professional management structure to meet the challenges of the modern world and remain vigilant in maintaining high standards of practice and ethical conduct.

Conflicts of Interest: A Leading Cause of Claims

Conflicts of interest remain the top cause of legal malpractice claims, as confirmed by the latest Ames & Gough survey. These claims are particularly difficult to defend due to the ambiguity of lawyer conduct and the burden of proving professional default. Once a conflict is established, it can heavily influence how a jury interprets otherwise ambiguous actions – a significant legal vulnerability.

The Rise of Artificial Intelligence in Law

AI has quickly moved from concept to practical application in the legal profession. Already, AI tools are being used to:

• Conduct legal research and draft briefs
• Prepare for depositions, voir dire, and trials
• Review documents and transcripts to create timelines and identify key issues

While AI offers efficiencies, it also brings new risks around competence, confidentiality, and ethical boundaries. As its use grows, so does the potential for malpractice claims tied to its deployment.

For solo and small law firms, AI represents not just a challenge but a powerful opportunity. These firms can take meaningful steps to explore and embrace AI by starting with education – attending CLEs, webinars, or bar-sponsored workshops on legal tech. Developing a simple, thoughtful AI policy can help firms stay ahead of regulatory expectations and ethical obligations.

Solo and small firms should also evaluate available tools tailored to their size and practice areas, including AI-powered research tools, practice management platforms, and document automation solutions. Many of these tools offer free trials and low-cost entry points. By approaching AI with curiosity and intention, small firms can improve efficiency, serve clients more effectively, and remain competitive in a fast-changing legal landscape.

Clio has some excellent educational resources on AI – visit Law Firm AI Policy Template, Tips & Examples | Clio. Clio also offers a free AI fundamentals certification – perfect for the legal assistants, paralegals, and young lawyers in your firms – The Legal AI Fundamentals Certification | Free Video Course | Clio.

Looking Ahead

The legal landscape is being shaped by an array of forces: demographic changes, technological innovation, evolving work models, and persistent ethical pitfalls. Awareness and proactive risk management are key to helping lawyers navigate this environment and minimize exposure to claims.

Lawyers Mutual remains committed to providing resources, education, and support to help North Carolina attorneys adapt and thrive in this ever-changing profession. Call us to schedule a consultation, a lunch and learn, or a law firm retreat presentation.

Camille Stell is Vice President of Risk & Practice Management for Lawyers Mutual Liability Insurance Co. of NC and is the co-author of the book, RESPECT – An Insight to Attorney Compensation Plans, 2nd Edition published October 2024. Continue this conversation by contacting Camille at camille@lawyersmutualnc.com or 800.662.8843.