Clients and law firms will both suffer if the Solicitors Regulation Authority pushes through reductions in minimum insurance cover, the Law Society has warned.
Regulators want to reduce the minimum indemnity threshold from the current £2m, to between £1m for conveyancing firms and £500,000 for all others.
The SRA, which had to abandon a similar proposal in 2014 after opposition from the Legal Services Board, says current limits are too rigid and expose firms to paying for protection they do not need. But the Society is concerned the proposals radically reduce fi nancial protection for clients and solicitors, without any guarantee of lower insurance costs as a result.
‘Clients, employees and solicitors would bear signifi cantly higher risk, but there is no evidence this would be counterbalanced by lower insurance premiums,’ said deputy vice-president Simon Davis.
The SRA consultation closes on Friday.