SRA hits back after Law Society attack on indemnity reforms
Philip: SRA will come back with specific recommendations
Paul Philip, chief executive of the Solicitors Regulation Authority (SRA), has hit back after the regulator’s indemnity insurance reforms were fiercely criticised by the Law Society.
Mr Philip said the latest plans, set out in a discussion paper published in July, contained “absolutely no recommendations”, despite what “other organisations” had said.
The chief executive told yesterday’s SRA board meeting that the regulator would “come back with specific recommendations late this year or early next year”.
Mr Philip described how the Legal Services Board said it needed more evidence before approving last year’s reforms plans, including reducing the minimum level of compulsory cover to £500,000.
“We have taken a wider view than we did before, but we have made absolutely no new recommendations”.
Responding to the discussion paper earlier this month, the Law Society said the regulator’s “starting points remain flawed” and the plans could “only increase the burden on firms and raise uncertainty” as to whether firms were complying with the rules.
The society said the paper appeared to be “driven by a desire to reduce solicitors’ overheads” and claimed cost savings which were not substantiated.
It said: “No one is calling out for radical changes of this kind. Firms and insurers are used to working with the existing protections and consumers rely upon them. Conveyancing firms in particular would find their business severely hampered.”
After the SRA board meeting, Crispin Passmore, executive director for policy, told a press briefing: “Over the last 12 months we’ve been trying to build evidence to make changes and are in discussions with insurers about data sharing.
“We have to justify regulation, not justify change. All regulation is costly and is paid for ultimately by consumers. If reducing the minimum level of cover to £500,000 reduces the cost of legal services, then it is a benefit.”
Mr Passmore said that for small firms, a 10% reduction in their indemnity insurance premiums could be significant. “It might not change the world, but you’ve got to keep chipping away.”
Tags: Indemnity insurance, Law Society, Solicitors Regulation Authority
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