Blackfriars Group
Professional Indemnity Insurance
Open until 1700 Monday to Friday
Call Now 01270 767327
Professional Indemnity Insurance
Open until 1700 Monday to Friday
Call Now 01270 767327
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We offer a range of services and products to cater for solicitors professional indemnity insurance. This page tells you how to obtain a quotation from us for solicitors indemnity insurance and also provides background to both the solicitors professional indemnity insurance market and the markets we use. How to obtain a quotation Obtain your on-line proposal here complete it and return it to us. Alternatively, we may be able to utilise a form you have already completed – send it to us by fax on 01270 527588 or by email to solicitors@blackfriarsgroup.co.uk and we will let you know. |
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If you would prefer to speak to someone directly please call us on 01270 767327.
As the Law Society Gazette reported on 2nd
October, ‘Firms shut as cover crisis deepens’, (more on that below)
the 2008 solicitors professional indemnity insurance season had
indeed proven to be the most difficult for some years. It
wasn’t a complete shock, however, and for our clients, who all
worked with us to start early, all were ‘home and dry’ prior to the
1st October deadline. That is not to say there haven’t been
increases however; our niche specialist firms have been insulated
largely from the market increases, however other general practice
firms have seen increases of about 20% to 50%. A number of
underwriters exited the market prior the 2008 season and a number of
those remaining, imposed higher terms, increases based on work types
and the most stringent and thorough examination of risk to date,
requiring copies of ‘no claim’ summaries back to 2000, any relevant
Law Society or SRA correspondence etcetera (which we know frustrated
case workers at the SRA, as random visits do not necessarily receive
a ‘closure of action’ report and insurers seemed set on seeing one!
Never has the recommendation to ‘start early’ been more pertinent.
It is quite amazing the number of firms prepared to leave such an
important issue until the last minute, however as this is a practice
that may have paid off in earlier years… Insurers assign a
capacity to their renewal and they try to designate sufficient
capacity for their renewals and then when the rest is taken, it is
taken and the book closes. The warnings of some insurers
exiting the solicitors’ professional indemnity insurance market, or
others exiting certain sectors of the market, had been reported well
and the lateness of proposal submission is ever more surprising for
these reasons.
We look after firms falling into the majority
sector and not the top 100 firms. This will be a very
different read, we anticipate, than for the top 100 firms; we
understand generally they will have fared well again although the
Gazette article cited an increase of 60% for a top 35 firm, as
reported by one broker, so perhaps we have to just wait and see.
We are now as busy as we have been for the past
month and have been helping a number of firms to avoid the Assigned
Risk Pool and continue to try to assist others in difficulty.
With this work, we have seen increases of over 100%, indeed some
offers have been either just below the ARP premium or even above.
Whether this is because the insurers feel the ‘right’ price has been
offered, or the ‘achievable’ price has been offered, we are not
quite sure and opinion can vary case by case. Firms will have
applied to or contacted the ARP and will have been told to keep
looking as they have an extra 30 days to try to find a Qualifying
Insurer willing to accept their proposal, writing a policy from 1st
October. Our role is almost a counselling role now; we see
proposals from some firms and we do not think we can help as there
are factors in existence that are going to be difficult to overcome,
however there are other firms that do not demonstrate anything
significant and for them (and for us) this process is particularly
distressing. We have seen several proposals from firms insured
with one particular insurer via a ‘tied’ broker facility and if we
are to believe the recent history, this particular broker and
insurer has been in receipt of proposals from their existing clients
for some time and issued a ‘decline’ only at the very last minute.
Frankly, we think these firms should be able to sue; the
implications of something like this are too serious to ignore.
As an independent insurance broker we have seen none of these
‘games’; we haven’t seen any of the delays reported by some, in
obtaining quotations. We have experienced a generally
efficient service, within a market place that is undoubtedly been
the most trying yet. We have been busy and we only scratch the
surface. Imagine how busy the insurers have been, trying to
deal with 000’s of proposals in such a tight timeframe? We
spoke with one underwriter who hadn’t seen his family for two weeks!
The calls to allow staggered renewals make pure sense and the
refusal to allow such, makes no sense. Why would a Regulatory
body not wish to help it’s membership in this way?
On the issue of the Law Society Gazette, we just
wonder, logistically, how straightforward and quickly one can just
close a practice, requiring a firm to place the current insurance
into run-off for a mandatory six year period, at the % multiplier
based on the 2007 renewal price. This must take time and
careful planning; surely one cannot just close the doors and the
‘open’ files with it? What about the clients? What about the
implications of letting down these clients? Pass the files, work
etcetera – simply give it away - to anohter practice and the other
practice could become the successor practice to the closed firm,
which is not an issue to be taken lightly, particularly if the
closing firm has had problems with the arrangement of indemnity
insurance. So we just wonder about the ‘forced closures’ – it
just doesn’t seem that will have been a practicable option to us.
THE EARLIER YEARS
Prior to the 2007 renewal, we felt we might see a rating correct but we did not. It seems we were a year early with our prediction! The 2007 Solicitors’ PI season demonstrated, yet again, a continuation of the annual decline in terms of premium spend but this was viewed by many as ‘unsustainable’. It was felt that a necessary rating correction must take place at some point – but when is the question? 2008, seems to be the answer.
In 2007, generally the professional indemnity insurance market (and this is not limited to the PI market) was awash with over capacity, with supply out-stripping demand and no abatement to the numbers of new entrants wishing to participate, thus driving prices lower and lower. At the smaller end of the market there were some, frankly, incredible deals around, leaving us ‘open mouthed’ with shock in readiness for what we may encounter next. We saw the odd exception in the financial and mortgage broking sectors – and the Royal Institute of Chartered Surveyors had recently reported that Professional Indemnity Insurance premiums were likely to increase for their members, as insurers are quietly nervous there will soon be another epidemic of claims arising from an, as yet, unknown source.
Solicitors Indemnity Insurance Rules 2008
The Solicitors Regulation Authority (SRA) will now deal with all such issues. The Rules will be revised and moved to the SRA’s new website, which we hope will be as comprehensive as the pages that used to be posted by the Law Society. http://www.sra.org.uk/home.page
Risk Management for Solicitors and the new Code of Conduct
The Code of Conduct at last received statutory approval and will be in force from 1 July 2007. Business continuity planning will be a statutory requirement for solicitors in England and Wales when the new Code of Conduct comes into force. In addition, all solicitors in England and Wales will have to have procedures for risk management with such procedures requiring a mechanism for review. The Lexcel standard will also have been amended to require firms to have a plan.
We are, at the time of writing, imminently to ‘test drive’ a system to help firms of all sizes in this respect. Do ask us about this service.
How is Solicitors Risk Management viewed?
No longer is it felt that the professional indemnity policy constitutes the firm’s risk management. We have experienced the widespread fact that solicitors’ attention to risk management has increased significantly since 2000, so if one good point has arisen from the demise of the Solicitors Indemnity Fund, this has.
The ‘whole’ - professional indemnity, anti-money laundering, conflicts, merger & lateral hire due diligence, training in risk management - appears to continue ‘on the up’, which will be rewarded within those firms that have taken heed…It’s not just about ticking boxes to reach regulatory compliance, neither is it only about learning from mistakes - it’s about actually trying to prevent problems from happening in the first place, by addressing all the issues in an holistic fashion – the substance is in the very culture of a firm.
We are committed to providing help towards clients’ risk management needs. Certain insurers offer a free risk management consultancy, as an integral component of their professional indemnity programme and we recommend you use this, if available.
It takes one to know one…
Whatever your choice, it remains our belief that solicitors make the best risk management partners for solicitors. We offer advice ‘to a point’ but the solicitor risk managers can advise you in a much more productive way, on the most effective techniques for reducing the risk of claims, including:
Solicitor risk managers regularly address seminars and workshops on claims prevention and related themes and often you can gain CPD hours also. Themes can often be designed to fit the specific practice of your firm. Certain insurers produce fact sheets, newsletters and hold seminars that will help to alert you to frequently made mistakes and methods for controlling claims.
Ask us about the risk management service / Lexcel service / Anti-Money Laundering / compliance services.
…should also be considered as vital by all incorporated practices (equivalent of Directors & Officers Liability) to cover the personal liabilities of the directors & members of the incorporated practice. Ask us for a quote; this often costs less than you might imagine – a small price in any event for further peace of mind.
Completing the Solicitors Professional Indemnity Proposal Form
The advice: Try to continue the relationship with your insurer this year. If changing, select your insurer carefully. Do some research – ask of them their ‘CV’ details relevant to writing solicitors professional indemnity insurance for your firm! (We’ve been doing it for about 20 years!)
Please take time to complete your form correctly. Please ‘vet’ your form before you send it to us and ensure all information is present. Missing information i.e. claims details and SIF summaries; disciplinary reports; area of Practice not totalling 100%. This will save time in the long run as if you do not present a full and complete proposal it will be rejected. The insurers are understandably short of resources - imagine looking at potentially 10,000 proposal forms and some of them more than once!
Solicitors Professional indemnity Insurance Markets Available to You
At the time of writing the 2007 list has not been published, however we already have a good idea of how this will pan out.
Last year’s list, as we have written, finished with a membership of 30 Qualifying Insurers.
The reality, when you research the list, is that you didn’t have a choice of 30 at all. Some are unable to quote for sole practitioners; some will only quote for firms with over 4 partners; some will not quote for any new firms, choosing to concentrate on and consolidate the existing client base; some are one and the same; some only wrote policies for ‘top up’ insurance; some have a minimum premium of £10,000 which may not suit you! – and so on…
The Blackfriars Group Mission
To help all firms from new - starts to sole practitioners (including those with no support staff), to larger firms, to include ‘distressed’ firms - to obtain compulsory professional indemnity insurance coverage, based on the minimum terms wording with a Qualifying Insurer, offering guidance as and when required.