Indemnity cover costs 'scandalous', says LawNet boss

The insurance industry is 'scandalously' overcharging lawyers for indemnity cover, and hundreds of firms could be needlessly paying too much, the managing director of LawNet - which represents 54 regional law firms - said this week.

John Thomas, himself a former insurance executive, said: 'The insurance industry says renewal premiums have to increase because of the rising cost of claims.

They say claims of more than 1 million are becoming commonplace.

'Yet among our firms we've never heard of one.

Even claims of as much as 200,000 are still rare.

I think the insurance sector is overstating its case.'

Premiums for top-up cover have risen even more steeply than for the compulsory first 1 million, and Mr Thomas noted: 'Top-up cover in particular is heavily over-rated and what you pay has become a bit of a lottery.'