Property-related professional indemnity (PI) claims against solicitors have fallen sharply as a percentage of the overall claims faced by the profession, statistics from broker Alexander Forbes revealed this week.

Property claims amounted to 31% of all claims notifications in 2004, compared to 40% last year, probably the result of a cooling property market.


Commercial property claims accounted for 15% of claims overall, down from 20%, while residential property claims fell 4% to 16%.


Property: cooling market

Sole practitioners saw a significant rise in commercial property-related claims, however, jumping 10% to 43% of all claims against them. In contrast, residential claims against sole practitioners plummeted from 21% last year to just 4%.

Personal injury claims have seen a steady rise, growing from just 5% of indemnity claims in 2001 to 12% this year. Personal injury has now overtaken trust and probate as the second most common area for claims. Martin Ellis, director at Alexander Forbes, said: ‘It is not clear why [personal injury indemnity claims have risen], but it is certainly clear that despite more firms adopting a more robust approach with risk management and investing in case management procedures, there is still more that the profession needs to do to reduce the numbers of potential negligence claims.’


A spokesman for the broker added: ‘The drop in property-related claims may be due to the lower level of property transactions, or an increase in low-risk transactions such as re-mortgaging, with more people choosing to re-mortgage rather than move house.’


Claims for litigation, financial and trust and probate work accounted for 10% of claims each, while landlord and tenant and commercial work amounted to 5% of claims each. Employment claims were 3% of the total.