The Solicitors Regulation Authority is reconsidering its controversial decision to close the Solicitors Indemnity Fund to new claims later this year. An announcement on a possible extension is expected early next week.
The matter was discussed at the SRA board’s meeting on Tuesday, after the Law Society asked the regulator to review the plan.
'While we’re keen on a timely resolution to this matter, we recognise this is an important and complex issue and that the SRA needs time fully to consider our request,' the Society said today. 'We’ll provide a further update to members once we know the SRA’s decision.'
The SRA has previously said the fund, which covers firms and solicitors facing claims beyond their six-year run-off period, is not within its remit and wants to pass responsibility for it to the Society, the representative body.
But with the insurance market unresponsive, many retired solicitors face the uncertainty of being unable to secure cover and living with the knowledge they could face ruinous payouts for historical claims.
In the joint letter to the SRA last month, Law Society president I. Stephanie Boyce and Legal Services Consumer Panel chair Sarah Chambers urged the regulator either to extend the SIF beyond the end of September or put in place an immediate alternative arrangement to mitigate the impact of its closure.
The SIF had net assets of £22.48m at 31 October 2020, with around 200 cases ongoing. The joint letter stated that an extension may be affordable within existing funds, offering the chance to provide cover until a ‘viable, adequate and appropriate market replacement is established’.