Solicitors

All firms of solicitors in England and Wales are represented by The Law Society which requires each firm to secure PI insurance complying with Minimum Terms and Conditions with effect from 1st October each year. Primary cover must be purchased from a Qualifying Insurer, either directly or via a broker, and evidence of cover must be made available to The Law Society.

The level of primary cover stipulated by the Minimum Terms and Conditions is £2 million any one claim for a firm which is not a body corporate and £3 million any one claim in respect of most bodies corporate such as LLPs. Cover in excess of these amounts is not subject to the Minimum Terms and Conditions and can therefore be of a more restrictive nature and can also be provided by non Qualifying Insurers (for instance those not wishing to provide primary cover who are therefore not deemed to be Qualifying Insurers).

Firms are free to negotiate with Qualifying Insurers the level of self-insured excess but must be mindful that, in the event of a successful claim made against the firm, insurers will seek to recover this amount from the Principals of the firm.

One of the main differences between a PI policy for a firm of solicitors and policies for any other profession is that cover must include a period of six years run-off in the event of the firm ceasing to practice during the indemnity period; firms must be aware that Qualifying Insurers are entitled to, and often do, charge an additional premium for this cover which should be disclosed when terms are put forward.

Qualifying Insurers tend to issue their own policy wordings but care must be taken to ensure that the cover provided is at least that stipulated in the Minimum Terms and Conditions.

For those firms unable to secure quotations or are not able reasonably to afford the premium, an Assigned Risks Pool (ARP) has been established to accept those risks that fall into this category but only for a maximum period of 24 months.

Quercus PI has been arranging cover for solicitors in the ‘open market’ with Qualifying Insurers since September 2000 following the demise of the Solicitors Indemnity Fund (SIF).

A full range of advisory services is available from completion of proposal form to issue of policy documentation/evidence of insurance and throughout the policy period which will include advice in relation to risk management, claims handling and regular updates on topical market and claims issues.

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