Chancery Pii has taken time to carefully consider the various proposals presented by the recent SRA consultation, we are pleased to share our official response in full.
In March 2018, the SRA published a consultation, “Protecting the users of legal services: balancing costs and access the legal services”, which outlines proposals for the Solicitors’ Compensation Fund and professional indemnity insurance (PI) with the stated aims of:
ensuring the needs of those who deserve protection are met and ensuring the longer term sustainability of the Compensation Fund;
reducing the cost of PI insurance, particularly for firms working in low risk areas;
reducing run-off costs; and
removing barriers for new firms entering the market and improved access to legal services.
The main PI proposals are:
1. Reduce the compulsory level of PI insurance to £500,000, or £1m if a firm does conveyancing work
2. Reduce the run-off requirements from six year any one claim cover up to the primary limit, to £1.5m or £3m (if conveyancing) over the six year period
3. The broad protection of the minimum policy not applying to commercial customers with a turnover in excess of £2m.
Chancery Pii has reflected on the proposals and whilst we have a number of concerns, it’s important to note that not all of the proposals are detrimental and the consultation does present some pragmatic solutions, such as separating the insurer agreement from the minimum wording, which we feel will result in better and more easily understood products.
We applaud the SRA for consulting, but we do have serious concerns around the data used and their interpretation of it.
We have chosen to publish our response to the consultation in full which you can read by clicking the link below: