Elite Insurance, one of only three unrated indemnity insurers of law firms and the only one based in Britain, announced yesterday that it is leaving the market. Elite cited increased risks of client account fraud and the government’s planned increase to the small claims limit as reasons for the move.
Firms that have not secured professional indemnity insurance have until tomorrow to notify the Solicitors Regulation Authority. Despite the abolition of the single indemnity renewal date last year, 1 October remained the deadline for more than 90% of law firms.
Rated insurers may be reluctant to offer law firms indemnity limits as low as the £500,000 proposed by the Solicitors Regulation Authority (SRA), a leading insurance broker has warned.
Yorkshire Building Society has said it has “no present intention” of reconsidering a ban it has decided to impose on firms with unrated indemnity insurers, even though the Solicitors Regulation Authority last week decided against one.
The SRA has acknowledged that the majority of responses received to its consultation on banning unrated indemnity insurers favoured a ban. Of 31 responses, 18 were in favour and 13 against.
Another unrated indemnity insurer is “likely to be put into liquidation”, the Solicitors Regulation Authority (SRA) has warned. The news comes as the SRA announced that it will not introduce a ban on unrated insurers.
The Yorkshire Building Society group will insist that all law firms on its conveyancing panel have rated professional indemnity insurers from 1 October 2014, it has announced. The rule will apply at once for new applicants to the panel.