On the 4th Nov 2009 The Law Society’s council voted overwhelmingly in favour of pressuring the Solicitors Regulation Authority to abolish the single renewal date for…
The end of the single renewal date for PII?
On the 4th November 2009 The Law Society’s council voted overwhelmingly in favour of pressuring the Solicitors Regulation Authority to abolish the single renewal date for professional indemnity insurance (PII), in favour of staggered renewals.
Some 55 council members voted in favour of the move, with 14 against and three abstentions. Chancery Lane submitted a paper to the council meeting inviting council members to support the move, while acknowledging that it would not resolve every problem. The SRA, which administers PII rules, is already considering potential reform.
Chancery Lane claims that the advantages of staggered renewals outweigh the benefits of a single renewal date. It predicts that staggered renewals would probably lead to lower premiums, more flexibility and choice for law firms, and closer alignment between premiums and risk.
The Law Society also cites a membership survey in July, which found that 71{0a6a65c996ed4169444354e707b897cdb00dbefc1d0429e8febb9bf11027ba53} of solicitors supported the switch.
However, it notes ‘reluctance’ on the part of the SRA to make the change because of logistical difficulties and cost.
Chancery Lane took advice from consultant actuaries Lane Clark & Peacock, which examined the issue and recommended a staggered policy renewal approach.
