Aon plc, a leading global professional services firm, has launched its Professional Liability Risk Analyzer, a proprietary tool designed to help law firms understand, quantify and manage professional liability risk.
The analyzer combines firm-specific exposure data, historical loss experience and Aon’s proprietary modeling. It draws on the company’s 30-year Lawyer’s Professional Liability claims database to simulate the probability and severity of losses across different scenarios.
Aon said the tool converts professional liability risk into a measurable financial exposure, giving firms a clearer view of potential volatility and how different insurance structures respond to losses. The analysis is intended to support insurance program decisions before coverage terms, limits and retentions are selected.
“Too often, insurance decisions are made before firms understand the risk they’re trying to manage,” said Kristin Kraeger, CEO of Aon’s Professional Services Practice. “The Professional Liability Risk Analyzer helps law firms quantify professional liability risk as a financial exposure, so they can evaluate how different insurance structures actually perform under stress.”
The model applies different insurance program structures to simulated losses based on each firm’s risk profile. Firms can examine how retentions, limits and coverage perform under pressure, where policy limits are most likely to be exhausted and how retained losses accumulate over time.
The analysis also allows law firms to compare the cost of different program structures against the level of financial protection they provide. This gives risk and finance teams another way to test whether an existing insurance program matches the firm’s exposure.
“Very few risk advisors have the depth of data and market presence required to model professional liability risk this way,” Kraeger said. “With this level of insight, firms can move beyond assumptions and see, with clarity, the tradeoff between cost and risk protection.”
The tool is currently designed for law firm professional liability, though Aon plans to extend it to other professional services sectors. Accounting and consulting firms are among the areas identified for future expansion.
Aon said senior legal executives often manage insurance decisions alongside other responsibilities within their firms. The analyzer presents modeled risk information in a format intended to support discussions with partners, finance teams and other stakeholders involved in insurance purchasing.
The Professional Liability Risk Analyzer is part of Aon’s broader Risk Analyzer suite. The suite uses company data and modeled loss scenarios to help organizations evaluate risk and insurance structures beyond static market benchmarks.
