City lawyers have warned that the ‘solicitor brand’ could be at risk if changes are made to minimum indemnity insurance requirements.
The City of London Law Society this week raised a number of concerns about SRA plans to reduce minimum compulsory PII cover to £500,000.
In a response to the SRA consultation, which closed last week, the CLLS professional rules and regulation committee said the regulator should have consulted with insurers before making any proposals.
What is planned, the committee warned, could damage the reputation of the England and Wales legal profession as a whole. ‘We have a strong concern that these changes may increase significantly the incidence of uninsured claims and undermine confidence in the profession,’ the response said.
The committee, chaired by Slaughter and May head of compliance Sarah de Gay, said it supported the objective of reducing costs and encouraging new entrants to the market.
But the response added the SRA has no evidence to say whether a reduction in compulsory cover will achieve that – and indeed with the majority of claims falling within the first £500k of cover, the change may have ‘no impact’ on premiums anyway.
The committee also complained that the time given for the consultation on the issue was too short at six weeks – particularly as the SRA is running three other consultations at the same time.
As other organisations have echoed , the CLLS raised concerns about the timing of the proposals, saying it would ‘very much doubt’ the market would be ready to respond by October.
‘We would strongly recommend that any reform is delayed until the 2015 renewal,’ added the response.