Insurance Companies to Blame?

Jamie Holden’s comments on What About Clients One GC’s View of the Billable Hour caught my attention. Although his points in A and B are right on, others were off the mark. Jamie says:

Ironically, it is the insurance companies who have been responsible for the huge assault on hourly rates, and who also stand in the way of reasonable fees for services.

Hourly billing did not come from the insurance companies. It was foisted on clients by attorneys, not vice versa (what client would ever say—“Hey, I know, bill me when you’re done, so I have no clue what price I’m paying”).

He’s mistaken about the insurance companies creating alcoholism, depression, low morale, etc., of attorneys.

Of course, it’s also ironic that the insurance companies, by insisting on making lawyers slaves to the time sheet and billable hour, have essentially created a large causation factor in lawyer dissatisfaction, with accompanying increased rates of alcoholism and substance abuse, depression, and disability, all of which increase the indemnity payments these same insurance companies are forced to pay.

Last time I checked, attorneys had free will, and were masters of their own fate. The fact they stay trapped in a sub-optimal pricing scheme is their fault, and their fault alone, certainly not the insurance companies. In order to fix this problem, lawyers are going to have to admit they perpetuate it, not the client.

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