The 2026 16th Annual Lawyers’ Professional Liability Claims Survey shows a clear increase in both the frequency and severity of malpractice claims. The results point to a tougher risk climate for law firms in New York and nationwide.
This also reflects a new normal where firms cannot act only after issues occur. There is now a larger need to manage risk early. The sections below outline where most claims come from, what is changing and how legal firms can reduce exposure.
Where most claims originate
Conflicts of interest are still the top cause of legal malpractice claims. This can be especially risky because many attorneys often overlook, poorly record or leave vested interests unchecked as a case changes.
Business deals, corporate and securities matters and trusts and estates also lead to many claims and large losses. These matters often involve big money, complex paperwork and results that are hard to undo. Because of this, malpractice losses are more likely to arise from legal practices that handle these sectors.
Artificial intelligence (AI): Efficiency vs. liability
Generative AI is quickly reshaping legal work, especially research and drafting, as lawyers use it to write memos, summarize cases and speed up routine tasks. However, it also creates new liability risks. AI is prone to producing false cases, citations or analysis, making it crucial for lawyers to verify everything.
Confidentiality is another concern, since entering sensitive client information into public AI tools may expose that data, since the platform may store or reuse it. Lawyers also must supervise AI-assisted work closely. Failing to review and correct output can lead to ethical violations, client harm and malpractice claims.
Escalating costs and loss severity
Social inflation is driving larger payouts and more mega-claims, as shifting juror attitudes lead to higher awards and greater exposure for defendants and insurers. It also makes claims harder to predict and manage.
At the same time, defense costs are rising due to higher legal fees, expert expenses and the complexity of modern litigation. As a result, even successfully defended cases can be expensive.
Mitigation strategies for law firms
Establishing clear AI-use guidelines and maintaining strong risk management practices can help law firms avoid legal malpractice claims. Regularly updating their insurance coverage and internal protocols is key to addressing evolving technologies, client expectations and liability risks.