The plan to change the level of mandatory cover has one more hurdle to clear.
You can tell the Solicitors Regulation Authority is confident of its board members toeing the line by how quickly the press release appears on your desktop.
This afternoon the dozen or so members were required to vote on changing the minimum mandatory insurance cover from £2m to £500,000.
It’s a proposal with the potential to affect every firm in the country (albeit, a little tenuously, the biggest) and has stirred lots of opinion on our message boards – with very few sitting on the fence.
As it turned out, the members voted almost unanimously to go with the £500,000 cover. The press release, tellingly, was out within 10 minutes. One wonders if a statement had been pre-prepared in the event of the board voting down the proposal.
The Law Society disagreeing with an SRA proposal is hardly new, but the strength of feeling was such on this occasion that a delegation came from Chancery Lane to Birmingham to make a last-ditch appeal for members to say no. In three years of covering these meetings, I’ve never known an ‘outsider’ be allowed to make such a plea, and former president Linda Lee spoke with great passion and sense about the dangers of changing the minimum level.
The basis of lower premiums and a liberalised insurance market was a fallacy, she argued, adding that instead the smaller firms will be priced out of anything but minimum cover – then shunned by potential clients because they don’t offer enough cover. A classic Catch 22.
But the arguments fell on deaf ears. Just one member – another former Law Society president, Paul Marsh, voted against.
But is it the end of the matter? Far from it: the reform still requires approval from the oversight regulator, the Legal Services Board.
You can be sure that both the Society and SRA will be banging on the LSB door to get their points across. And it’s certainly not beyond the realms of imagination that the super-regulator might decide this is all moving too quickly. After a six-week consultation and two-hour board debate, you wouldn’t blame it.
John Hyde is a Gazette reporter