Insight

Professional Indemnity Insurance Market Report

Published

24 July 2021

Read time

3 minutes

Professional Indemnity Insurance Market Report

Howden’s London Solicitors Professional Indemnity (PI) team has released their latest Professional Indemnity Insurance Market Report. 

Given the commonalities of issues facing firms in both the London and Australian markets, as well as the importance of the London market participation on Australia law firm PI programs, the findings of the report bears particular relevance to the Australian legal PI market.

Importantly, recent PI insurance market conditions experienced by UK firms have been consistent with conditions experienced by Australian firms, particularly those who have just completed their 30 June 2021 renewal.

The below provides a summary of the items of specific interest to the Australian market:

  • Substantive commentary in relation to the “robust and forensic” approach to renewal information requirements. We have seen insurers’ appetite for additional information grow in recent times and the report notes that this has continued with additional information requirements governing business resilience. Firms need to be well advised by their broker in connection with both the preparation and presentation of renewal information. This is in order to achieve the dual goals of properly discharging their duty of disclosure, in addition to providing insurers with the required information while also advocating their firm’s risk profile as positively as possible.
  • The forecast for renewal outcomes in connection with policies renewing in the second half of 2021 and beyond. While it is reported that there have not been any recent insurer departures from the market, expectations remain subdued in terms of insurer competition and appetite for new business and as a result, further premium increases appear to be likely. 
  • The need for pre-renewal planning and preparation with your broker remains critical. The report highlights the crucial steps needed in order to ensure that firms are positioned as strategically as possible prior to going to market. A well planned and properly structured renewal process includes; reviewing all open claims and circumstances, timely notification of any new claims or circumstances and using the renewal process as a prompt to properly review relevant risk controls and policies.
  • The 10 common causes of PI claims against solicitors. From mental health of fee earners to cyber security risks to fundamental issues such as poor client selection and lack of supervision, the causes identified in the report are a timely reminder for Australian firms and reinforce the need to remain alert. 

Please find the report here.
 

Nick Chubb

by Nick Chubb

Summary by Nick Chubb | Head of Financial Lines

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