The first five years of an open market for solicitors’ professional indemnity insurance saw a complete change in the claims environment, according to new research.
Brokers Alexander Forbes compared the profile of claims against solicitors made under the Solicitors Indemnity Fund (SIF), which stopped taking new business in 2000, with the profile of claims made since.
Professional indemnity advisers said the open market had been good for solicitors. Barlow Lyde & Gilbert partner Sarah Clover said: “In general terms the profession’s paying very modest premiums for the cover that it’s getting.”
The study found that the percentage of conveyancing claims has dropped dramatically since 2000, from 46 per cent of all claims under the SIF to just 12 per cent on the open market.
But Alexander Forbes director Steve Holland said an increase in general property work “remains the underlying number-one cause of claims against solicitors”.
In contrast, the volume of claims brought following litigation has remained static at 12 per cent, but now accounts for 17 per cent of the value of claims. Commercial claims have also risen in value, up from 10 per cent under the SIF to 18 per cent now.
Despite the sensational collapse of The Accident Group, which has led to litigation against hundreds of firms, claims relating to personal injury work have remained static since the SIF folded.