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Law firms struggle to obtain PII cover in the final hurdle

With the 1st October PII renewal date looming, many law firms are struggling to find cover.

The manageable stampede is said to have turned into ‘significant turmoil’ since over 1,000 customers of unrated PII insurer Berliner were urged to find alternate cover.

Simon Lovat, of United Insurance Brokers’ commented: “1,100 practices coming into the market 15 working days before renewal poses a significant challenge to brokers and insurers, who are already working at near capacity."

To make matters more difficult, in the current market PII premiums are up to 40% higher than in 2012. It seems that this year, law firms will be looked at under the microscope before they qualify for cover.

According to the head of UK regulated professions for broker Marsh, John Kunzler, firms will have to demonstrate that they have ‘adapted to change’ and be able to prove that they have a strong business model.

Taylor relates: “Firms still looking for cover need to ensure that their renewal submission contains all the information required by insurers. The most common problem area is where ‘Qualifying Insurer Claims Summaries’ are either non-existent, incomplete or out of date. At this stage, it is vital all this information is provided as with the right information, solutions are often still available.”

Many fear that the quick shuffle to find cover could worsen the situation considerably. If firms are unable to secure qualifying insurance by the October deadline, they will automatically go into the Extended Reporting Period and have a 90-day policy extension from their previous insurer. Beyond this, if firms are still unable to obtain cover when this period ends, they may be forced to cease practice.

It has been noted that firms reliant on personal injury, legal aid and conveying are of the most vulnerable and are deemed to be of a ‘higher risk’ by insurers.

 

http://www.thelawyer.com/news/practice-areas/insurance-news/aon-steps-into-the-breach-after-xl-and-aig-reduce-pii-exposure/3008524.article

http://www.lawgazette.co.uk/practice/pii-news-focus-running-for-cover/5037647.article

http://www.lawgazette.co.uk/practice/hundreds-on-the-edge-as-pii-renewal-date-looms/5037600.article

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