Crisis? What crisis? Solicitors pay out 15% less for PII – but huge leap in uninsured firms

Print This Post

By Legal Futures

5 November 2010


Falling cost: PII premiums back to pre-recession levels

After all the predictions of solicitors’ professional indemnity insurance (PII) premiums going through the roof, figures from the Solicitors Regulation Authority show a 15% fall across the profession for 2010/11, back to pre-recession levels. However, there has been a massive 57% jump in the number of firms in the assigned risks pool (ARP). 

Solicitors paid £213.6m for the compulsory primary layer of cover, down from £246m in 2009/10 and £226m in 2008/9. It was £205m and £211m the two years before that.  

There will be speculation that some of the fall is down to law firms closing because of the quotes they received for PII, while a massive rise in the number of firms unable to find insurance and so falling into the ARP will also have contributed. 

The 30 days that firms without insurance had to secure and backdate cover has now passed with 337 firms still in the ARP(down from 383 last week). Before renewal there were around 214 firms in the pool.  

Insurers’ contribution to the costs of the assigned risks pool is based directly on their market shares. 

Last year’s market leader Chartis (formerly AIG) increased its market share to 18.1%, with last year’s two big entrants, Hannover and XL, hurtling up into second and third place with 14.4% and 13.3% respectively. Zurich maintained its share at 12.9% but Travelers fell to 11%.  

Rounding out the top 10 are QBE (8.2%), Allianz (6.4%), Aviva (4.2%), Lemma (2.9%) and Royal & SunAlliance (2.2%). Two of the 22 qualifying insurers took on no risks, while nine others wrote less than 1%.

NB This story was revised after originally posting when updated figures on the number of firms in the ARP were received.

Tags: ,



Leave a comment

* Denotes required field

All comments will be moderated before posting. Please see our Terms and Conditions

Legal Futures Blog

Joint (ad)ventures in the legal sector

Nigel Wallis lo res

We all know that nothing in life is certain. As the actor, director and philosopher Clint Eastwood once said: “If you want a guarantee, buy a toaster.” He also said he’d tried being reasonable and didn’t like it. They should teach this kind of philosophy in law school. One thing in life is reasonably certain though. If you’re a law firm worth your salt, at some point you will be approached by another entity (most probably a work introducer) with a whizzy idea to ‘partner’ with you to ‘help you accelerate your growth’. In commercial speak this means, ‘we’d like to keep feeding you work but we’d also like to share in your profits’. The arrangement may be pitched to you as a joint venture – a win-win no less.

March 27th, 2017