Month: November 2010

Unclear whether solicitors’ PI insurance storm has passed

[Updated] This time last year was not a happy one for many solicitors, with huge uncertainty in the insurance market delaying renewals. Insurance must be in place on 1 December 2010 and it seems that this year the market has been calmer, though many solicitors apparently have not been able to renew yet. Publicly, at least, there doesn’t appear to be any of the frenzied activity by the Law Society that accompanied last year’s renewal season.

 

From George Eastman House (Flickr)
Unlucky solicitor reacts to his 2011 insurance premium

Some major insurers, like Quinn and RSA, have left the market this year. The former was forced to leave the UK solicitors’ market earlier in the year as a result of its administration by the Irish Financial Regulator. However, in the past few days, two new entrants have been approved by the Law Society, suggesting that competition still exists and UK insurers see an opportunity to pick up new business. The full list of approved providers, including those not renewing cover this year, is available here.

Until last year, the SMDF was the largest insurer of solicitors and is a “for solicitors, by solicitors” organisation. However, it emerged in 2009 that the organisation suffered huge financial losses and subsequently lost around half of its customers. The SMDF benefits from a loan guaranteed by the Law Society, but that guarantee runs out next year so it remains to be seen what will happen if more customers are lost, as seems likely.

The rumour mill suggests that the huge surge in premiums has not ended for all solicitors. The premium for many firms, even small ones, can be the equivalent of an annual wage, or more.

  • 29 November 2010: Existing insurance cover for all solicitors expires tomorrow (30 November 2010). As solicitors are required to have insurance in place as a condition of practice, this should mean that anyone without cover on 1 December 2010 has to close their doors. The Assigned Risks Pool (ARP) provides insurance to any solicitor unable to obtain cover on the open market, but the cover obtained is more limited than the minimum terms and conditions of insurance for solicitors and, obviously, significantly more expensive. Last year, many were faced with the theoretical prospect of closing the doors as insurance companies had not processed all applications and supplied quotes in advance of the renewal deadline and, to further add to the sense of crisis, the ARP was suspended. However, such solicitors were assured that insurance would be backdated to 1 December 2009 (ignoring the regulatory requirement to have it in place). This year, the ARP has been renewed and it would seem from this email that anyone without renewed cover tomorrow should apply to enter the ARP, even if as a temporary measure.
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Our Country, Their Call

The Your Country, Your Call story trundles on and responses have been issued to freedom of information requests filed with the Department of Enterprise and Innovation.

I was hopeful, having received a weighty envelope from the Department, but such hope was misplaced. The response consisted mostly of a lengthy set of reasons as to why most documentation was not being released, extracts from the Freedom of Information Acts 1997 & 2003 and the four documents actually released.

The two interesting documents provided are the explanation of decisions and the schedule of documents held by the Department, both below. I will be appealing the decision not to release documents (though the “appeal” is in fact an internal review by the Department).

In the meantime, while it’s not clear what exactly is happening with An Smaoineamh Mór or its backers, it’s certainly clear that its PR machine still operates. Interestingly, a senior figure in an IT organisation that runs a range of blogs itself seems to think blogging is for do-nothing layabouts who fail to spend each and every minute of the day working.