For a few brief and benign years around the middle of the last decade, a certain tranquillity pervaded our regular features on professional indemnity insurance. With both existing and new entrants keen to build market share, law firms benefited from plenty of capacity and exceptionally competitive premiums. Just five years ago, for example, 10%-20% reductions were the norm. It was no coincidence that in 2016 the Solicitors Regulation Authority fielded the highest number of applications – exceeding 50 – from companies keen to be participating insurers.
That was then.
Law firms renewing on the traditional date of 1 October last year encountered the hardest market seen since demutualisation two decades before. This year, their predicament is likely to be even tougher. The market had been hardening for some time even before the pandemic and the economic fallout from a year of intermittent lockdown has not helped. Most, if not all, firms are again facing higher premiums and a dearth of competition for their business.
There have been suggestions from within the industry that the success of the vaccine programme and the prospect of a return to normal by the summer could ameliorate matters. As this week’s roundtable heard, however, there does not seem to be any sign of the market softening yet. We must earnestly hope that changes.
In the meantime, solicitors would do well to heed the advice of the Law Society’s own PII committee. Give yourself an absolute minimum of two months to arrange cover – and if you think there are any complicating factors, bring them to the attention of your broker well in advance.
Elsewhere in this issue, it would be remiss not to mark International Women’s Day by dwelling on an unprecedented diversity milestone. Later this month, I. Stephanie Boyce will become the Law Society’s first black president. She will be succeeded by Lubna Shuja, the first Asian president. And for the first time in the Society’s history, a woman president is on track to be succeeded by another woman.
A remarkable conjunction of events, and – as they reflect in conversation for the Gazette – one to be celebrated.