Law Society: Solicitors Indemnity Fund Closure Postponed by One Year
News of a one-year delay of the closure of the
In the two decades since solicitors in
We told our members in February that the SIF would close to new claims from
Without cover, former principals of firms, their estates and even individual employees may be personally liable for losses from any claims that are made.
"We had all hoped that a market would develop for reasonably priced post six-year run-off cover (PSYROC), but a hardening market has meant that the industry has been reticent to take on new risks.
"That means that there was a real danger that the closure of SIF at the end of September could leave former principals personally exposed to claims relating to work that their firm had done, perhaps decades in the past.
"Meanwhile, the additional uncertainty created by the Covid-19 pandemic and lockdown has only compounded the problems for former principals who may have been seeking affordable PSYROC products.
"Solicitors will be relieved, because with the breathing space this pause provides, the
Footnotes:
*/ 1)
2) Mandatory run-off cover is purchased as part of a law firm's professional indemnity insurance (PII) and lasts for six years after a firm's closure.
**/ SIF was originally slated to close to new claims in 2017, but following successful lobbying by the
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