Lawyers could become an uninsurable risk if the Solicitors Regulation Authority (SRA) fails to reform the professional indemnity (PI) insurance regulations.
The warning comes ahead of a crunch meeting between the regulator, leading solicitors’ PI insurers and the Association of British Insurers (ABI), at which the market will demand a series of reforms aimed at stemming rising rates.
Small firms are most at risk of being left uninsured at the 1 October renewal, but there are fears this could penetrate further up the profession. When the solicitors’ PI market last shrunk, firms faced rates hikes of up to 40 per cent.
The SRA said it had carried out an “extensive consultation” and had agreed “limited changes” to the system.
However, Mark Casady, schemes portfolio manager at insurer QBE, a leading player in the sector, said the reforms failed to go far enough. “The changes have been zero, and that’s unacceptable,” he stated.