The Solicitor's Indemnity Fund (SIF) wants lawyers to pay £242m in contributions next year – just £2m less than last year – despite seeing a 15 per cent drop in notifications in 1997/98.
SIF chairman, Peter Williamson, says that despite signs of a declining trend in claims in recent years, the unknown impacts of the Woolf reforms and the millennium bug, have made the monopoly wary of being overly optimistic when setting a contribution. The continuing decline in interest rates which would result in less investment income than in recent years, has also affected the amount to be collected next year, he adds.
The recommended figure includes a five per cent contingency margin and a provision for reinsurance and would allow SIF to pay claims projected at £258m, compared with pay claims projected at £288m last year.
Says Williamson: “It is impossible to give any indication at present of how individual firms will be affected. The introduction of risk banding in the current indemnity year led to significant changes to how the overall burden is shared by individual firms.