A solicitor’s Professional Indemnity Insurance policy (PII) protects you in the event that your client, or a third party, files a claim against you arising from the legal services that you provided. Negligence, breach of trust, and defamation are possible allegations.
PI claims typically arise from an alleged failure to meet your duty of care. This may result in some form of loss that the Claimant seeks to recover from you. Missing a deadline, giving incorrect advice or failing to follow instructions are examples of alleged failings. If you have to pay any compensation to the Claimant plus any legal fees that are incurred in defending the claim, this should be covered by your PI policy.
How it Works
A ‘claims-made’ basis is used to underwrite PI policies. This means that the PI policy that applies is the one that was in effect when the actual claim was made – not the one that was effective at the time when the work that prompted the claim was performed.
As soon as you become aware of a claim against you, or circumstances that could lead to one, you should notify your insurer.
Contact your insurer even if you think the claim might not happen or it has no merit, or if the sum claimed falls within your agreed excess.
What you cannot claim for:
The cost of defending a professional disciplinary proceeding. Under the old SIF arrangement, it used to be possible, but this changed in 2010 following proposals from the Legal Services Board. If disciplinary proceedings directly affect a claim covered by the policy, insurers can help defend that claim at their discretion.
Any complaints to the Legal Ombudsman relating to ‘service’ rather than allegations of ‘legal liability’. Usually, any awards for poor service (and the related Legal Ombudsman’s costs) are not covered.
Other areas unlikely to be covered:
- Dishonesty or fraudulent behaviour commissioned or condoned by the Insured practice.
- Penalties or fines.
- Liability for personal injury or property damage.
- Partner, shareholder, or employee disputes.
- Trading liabilities or personal debts of the Practice, including simple fee disputes and guarantees or warranties given for trading purposes.
Why Choose Legal Ex Plus
Our team have vast experience in the field of business insurance and risk assessment. By applying our in-depth knowledge of professional services, we are able to design innovative insurance programmes for each of our clients. Call us today on 08001804203 for a bespoke quote to suit your firms’ needs.