It has been revealed that there has been a 20 per cent rise in the level of mandatorypremiums that solicitors have to pay. The Solicitors Regulation Authority (SRA) revealed the figures that showed that costs were a fifth higher than they were in 2010.
For the 10,917 solicitors firms in England and Wales who found independent professional indemnity insurance for the year 2011/12, the total cost of insurance was £256 million, rising from last year’s £214 million. The rising levels of insurance costs are due to growing premium rates needed to protect companies should a claim of dishonesty or negligence is filed. A falling number of companies needing Assigned Risks Pool (ARP) assistance has also led to the increased figures that the solicitors’ industry are facing.
Whilst it was previously revealed that four main insurance companies including XL Insurance, Hannover, QBE, and Travelers provided over 50 per cent of polices for the market, it was announced that Chartis now only supplied nine per cent of the industry. This is in stark contrast to 2010, where it was a professional indemnity insurance leader taking the largest share of the market with 18 per cent.
It was also revealed by the SRA that Capita, the company who collects ARP premiums for the SRA, was currently chasing unpaid premiums surmounting to £7.6 million. In addition, with 39 cases having already been despatched to the Solicitors Disciplinary Tribunal, the SRA continue to take an aggressive stance against those not making payments.