Robust professional indemnity insurance (PII) is vital to protect clients and the solicitors who act for them, the Law Society of England and Wales said today, following analysis of statistics on PII claims published by the Solicitors Regulation Authority (SRA).
"Solicitors'professional indemnity insurance is one of the most important protections for clients. It helps to drive up standards as it incentivises good practice and it is one of the pillars that maintain public trust and confidence in the solicitor profession," said Law Society president Robert Bourns.
“It is important that the SRA's PII regime is reviewed on a regular basis so it responds to changes in the marketplace and the wider economy. We are grateful for this latest data on patterns of PII claims as it helps inform thinking on the PII regime. It is extremely useful for gaining an overview of a complex market."
The Law Society has scrutinised the data and accompanying analysis in consultation with insurers.
Robert Bourns continued: "We find no compelling evidence to suggest that reforms would provide a significant reduction in the cost of PII to firms, and therefore reduce the cost of legal services for consumers.
"PII provision across the range of legal services must strike the right balance between protecting consumers, protecting solicitors and promoting a competitive insurance market which enables affordable PII costs for firms.
"Reducing the minimum level would leave both clients and firms exposed to risks. The knock-on effects we wish to avoid in particular are instability and reduced trust in a legal services sector that is currently one of the strongest and most vibrant in the world.
"If the SRA is to consider reforms it should, in line with best regulatory practice, undertake a thorough cost-benefit analysis and impact assessment as to how these will affect the market, the profession, equality and diversity, and the clients who rely on firms to protect them."
Notes to editors
Read the Law Society's response to the SRA's publication
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