The Law Society of England and Wales welcomed the Solicitors Regulation Authority’s (SRA) decision to extend the life of the Solicitors’ Indemnity Fund (SIF) for a further 12 months and is pleased the SRA has heard our concerns and those of both the profession and consumers.
However, the Law Society called on the SRA to act quickly and work with us and others to develop a viable alternative scheme to provide post six year run off cover.
Law Society President, I. Stephanie Boyce, said: “We are pleased the SRA has heard the many reservations expressed by us and others about the closure of the SIF and has now removed the risk of imminent SIF closure at a time when no viable alternative is available.
“We have been raising our concerns with the SRA, the regulator for this issue, for more than three years. We are pleased they are now taking steps to find an effective solution and undertake the detailed analysis required to assess the future of post six-year cover.
“The SRA has accepted, as an important element of consumer protection, it is a problem that it, as regulator, must solve.
“But it is not enough simply to delay closure again in the hope that next year the commercial indemnity insurance market will change and fill the gap in consumer protection that SIF closure will create. The SRA must move quickly to publish its consultation on future options and put a plan in place.
“We urge the SRA to work hand in hand with the Law Society, the insurance industry and others to find a long-term solution to the problem of run-off indemnity cover. It needs to show imagination in looking at long-term solutions that provide proper levels of consumer protection and do not expose solicitors to ruinous claims or consumers to potentially lengthy and complex litigation.
“The Law Society will continue to make the case for solicitors and their clients, and we look forward to supporting the SRA in this critical area of its work.”