I think it's a lot of things. Any lawyer is insured to the level that makes sense for their work, so at some level that's really not a differentiating factor.

A lot of it comes down to things as varied as depth of bench, using their famous letterhead as a club, familiarity and traditional relationship, old boy's network and so on and so forth.

But it's still silly to give a one-conspiracy-fits-all account of the legal world.

I should've been more explicit, I meant against bringing it in-house. My partner is an experienced commercial real estate lawyer so, really, I'm just reflecting her view - she's worked on both sides, in-house and private practice. The only reason, in her experience, that companies don't bring that sort of work in-house is insurance and the hassle of liability being worn by the law firm rather than the company. Also, it allows the client (i.e. manager at the client) to have someone to blame when it all goes tits up.

This is really excessively cynical. Any law firm can buy liability insurance, not all law firms have the kind of legal expertise of Cravath, Swaine and Moore or Slaughter and May. They don’t have unique expertise but they have extremely rare, expensive and reliable expertise available in quantity and on demand. When the stakes if a contract goes to court are in the billions you do not skimp on mere millions in legal fees.