The Oregon State Bar Board of Governors created the Professional Liability Fund in 1977 pursuant to state statute and with approval of the membership. The PLF first began operation on July 1, 1978, and has been the mandatory provider of primary malpractice coverage for Oregon lawyers since that date. The PLF provides coverage of $300,000 per claim/$300,000 aggregate to every attorney engaged in the private practice of law in Oregon. This coverage includes defense costs and, in addition, there is a $50,000 claims expense allowance. The PLF's philosophy is that a program of this type must be mandatory for all lawyers in private practice in the state, as purely voluntary participation could result in adverse selection and a concentration of only the "bad" risks, leading to financial instability. Over time, the cost of coverage provided by the PLF has proved to be less than the cost of comparable commercial coverage.