Larger firms set to get insurance cuts

THE LAW Society has singled out medium to large-sized firms for significant cuts in their insurance despite claims of discrimination against small firms and sole practitioners.

Under the measures approved at the Law Society Council meeting last week, firms earning more than £500,000 in gross fees will receive a professional insurance indemnity premium reduction of around eight per cent.

But the council decided not to restrict the premium reduction to under two per cent to firms with gross fees of less than £500,000.

The proposal was attacked by some council members including presidential candidate Eileen Pembridge.

“Do we still want to have smaller fee earners in the profession or not?” said council member Angela Deacon calling for a rethink.

But a report to the council said over the last eight years practices with one, two or three partners paid significantly less than other firms in contributions compared to the proportion of claims they accounted for.

“To opt for an across-the-board reduction would be to ignore the unfairness of the persisting imbalance,” it stated.

A reduction in management costs and a projected increase in investment income was behind the premium reductions despite an estimated seven per cent increase in settlement claims.

A £20 practice certificate reduction to £475 was also announced at the meeting.