The lawyers and brokers taking part in the Gazette’s roundtable discussion on professional indemnity insurance (PII) were able to reflect on that rare thing – a ‘good’ story for pretty much the whole profession.
Premiums for solicitors’ mandatory insurance cover have fallen over time, the destabilising presence of unrated insurers is a thing of the past and market capacity has increased. The end of the single renewal date – 1 October – has proved popular, and has given underwriters the time to properly examine firms’ submissions with an expert eye. Badly run firms are no longer ‘washed in on the tide’.
It is worth reflecting that, from the point where solicitor PII opened to the commercial insurance market 17 years ago, there has been vocal opposition to each of the reforms and policies that ushered in this benign era for cover. Even the exhortation to avoid unrated insurers was met with objections.
Those who drove through change have reason to feel vindicated. But in this instance, reform can be usefully compared to the process of creating a painting – in that it is very important to know when to stop.
The SRA seems committed to reducing the minimum terms of cover from £3m to £0.5m, even though the effect on premium levels would be minimal and public protection weakened. This should surely be shelved – instead, reformers should take a moment to enjoy the view.