Post Six Year Indemnity Runoff Options

indemnity, sra, insurance, negligence

Following on from its statement last month on the Solicitors Indemnity Fund (SIF) and consumer protection for negligence claims brought more than six years after a firm has closed, the SRA has now published a discussion paper on the options that are available.

The discussion paper, entitled “Next steps on the Solicitors Indemnity Fund (SIF) and consumer protection for negligence claims”  is an update for stakeholders on the work of the SRA on future options to protect consumers who suffer loss from the negligence of a solicitor, but cannot claim under the law firm’s indemnity insurance because the firm has been closed for more than six years with no successor practice taking over liability.  It explains how further research and engagement has borne out concerns – raised during a previous consultation – that while the number of consumers potentially impacted by historic negligence cases is small, the impact upon them can be significant. It also outlines options being explored for potentially providing future consumer protection in a way that is more cost-effective and proportionate than the SIF in its current form.

The paper invites feedback on some specific issues in relation to any potential future arrangements. These include the approach to claimant costs and claims from large, corporate entities.  The paper also considers a number of other issues including protection for large corporate claimants, claimant costs and recovering claim payments.

The SRA is inviting feedback by 31 August and will also be discussing the issues raised directly with key stakeholders, including consumer and legal profession representative groups. All feedback received will help to inform our Board’s further considerations of what next steps to take at its September meeting.

The SRA’s previous consultation ran from November 2021 to February 2022 and received more than 300 responses. A summary of findings and next steps from this was published in April 2022.

Share on social media