Have you been unable to renew your professional indemnity insurance?

Information from the SRA

Professional Indemnity Insurance provides vital protection for clients should unexpected events cause them financial loss.

However, sometimes it can be difficult to renew policies for whatever reason. If this happens, a firm will enter the Extended Policy Period (EPP). The EPP makes sure that cover is provided by the last-named insurer for a further 30 days to allow your firm time to secure a policy. At the end of that 30 days, if you still haven’t been able to secure insurance you will move into the cessation period which lasts for 60 days.

Under the SRA Indemnity Insurance Rules 2013, every firm that enters the cessation period has an obligation to inform us of their position by emailing Firms should have also let their last recorded insurer know too.

It is important that you let us and the insurer that last provided you with cover know if this happens.

During the cessation period you should not be taking on any new business. While you can still be looking for insurance during this period, you must also be drawing up parallel plans to make sure that, should you not be able to get a policy in place, you can close in an orderly manner and do not continue to trade after the end of the cessation period. Read more information on closing down.

Firms facing practical difficulties in obtaining indemnity insurance because of Covid-19 may want to consider applying for a waiver to extend the EPP/CP but only if their insurer has agreed to that extension.

In addition, if you are going through a merger with or being acquired by another firm, it is important that your firm closes in an orderly way if it is not going to carry on as an authorised body and that the appropriate notifications are sent to us. Read more information about notifying us.

If you need further guidance, speak to our Ethics Guidance team.

Monday, 9th November, 2020