Almost 30 firms had applied to enter the assigned risks pool (ARP) within two days of the professional indemnity insurance deadline passing, the Solicitors Regulation Authority said on Tuesday.
The regulator’s figures show 28 firms had failed to secure cover on the open market as the Gazette went to press. The SRA insists the number has ‘remained low’ in what is the final year of the ARP. By 4 October last year, 53 firms had applied for PII cover in this way, with a total of 411 applications in 2010.
Any fall in firms entering the ARP will be welcomed by the legal profession, which has agreed to share the cost this year with the insurance industry.
From 30 September 2013, the ARP will stop providing qualifying insurance and be replaced with a system where insurers offer a three-month extended policy to firms which cannot obtain PII for the following year. From this month, all policies of qualifying insurance must make provision for this extension.
Meanwhile, the Law Society has urged former clients of the Lemma Europe insurance company to seek advice from their broker as soon as possible.
Last week, the Supreme Court of Gibraltar appointed a provisional liquidator to establish the financial position of Lemma after the company had been wound up. The firm was not a qualified insurer for the 2012/13 solicitors PII market, which closed on Monday, but wrote more than £6.2m of cover to law firms in 2010.