Solicitors PII: What happens if you can’t get cover…at an affordable price?

solicitors PII

Close to a third of firms now renew their professional indemnity insurance (PII) on 1st April. As we approach this date, we are reminded of the ongoing difficulties solicitors face in obtaining cover. 

The legal landscape is ever evolving, and several factors contribute to the challenges faced by solicitors in securing solicitors professional indemnity insurance.

The rising costs of PII have also become a huge concern for professionals across various industries, including solicitors.

Several factors contribute to the escalating expenses associated with obtaining PII, making it a complex issue that requires careful examination.


Reasons for difficulties in obtaining PII cover

Market conditions

The insurance market is influenced by various economic factors. In recent years, insurers have become more reluctant to provide professional indemnity insurance cover to solicitors. This shift has made it increasingly challenging for solicitors, particularly those in smaller firms and sole practitioners, to secure affordable and comprehensive PI cover.

Claims history

In recent years, that have been some high profile law firm failures which have left insurers with huge run-off claims to handle (6 years’ worth) with no premium income to offset.  A solicitor’s claims history can significantly impact their ability to obtain PII cover. Firms with a track record of frequent or high-value claims made against them may find themselves facing higher premiums or even declines to offer terms from insurers.

The escalating costs of legal settlements, judgments, and legal fees associated with defending claims contribute significantly to the overall increase in PII premiums. Insurers factor in the potential financial exposure when determining premium rates, leading to higher costs for policyholders.

Although the number of claims being made against solicitors has not drastically increased, save for a few exceptional law firm failures, the monetary values for these types of claims are surging.

Whilst many firms are not experiencing claims against them, the value of the pay-outs for those who are do now exceeds the total premium collected by insurers for all solicitors.

SRA minimum terms and conditions (MTC)

Solicitors PI insurance is less profitable and more difficult to underwrite than other types of insurance. The reason for this is due to the Solicitors Regulation Authority (SRA) Minimum Terms Contract (MTC), which often acts as a financial guarantee, containing more terms and conditions and a number of exclusions. The broad wording of the MTC may deter new insurers from providing cover for solicitors.

Specialised practice areas

Solicitors practicing in niche or high-risk areas of law often encounter obstacles in obtaining PII. Insurers may be hesitant to cover practices that involve substantial risk or uncertainty. As a result, solicitors in specialised fields, or those where the potential for claims is a high risk, may find fewer insurers willing to provide coverage, leading to increased premiums and limited options.

What happens if you can’t get PII cover for your firm?

Ensuring the renewal of your professional indemnity insurance is crucial for effective risk management within your firm. PII provides coverage for potential claims made against the organisation.   PII is one of the major single costs a law firm has, and it is essential that the renewal process is given a high priority, working with your broker to ensure that your submission truly represents you firm, how you manage your business, staff and risk.

In the event that a law firm encounters difficulties in securing solicitors PII renewal terms, it becomes necessary for them to enter the extended policy period and, if they fail to secure terms during this 30 day period, begin the closure of their firm during the cessation period stipulated by the SRA.

This period allows the firm a span of 60 days to carefully plan and execute either an orderly closure of the firm or explore alternative options, such as merging with or being taken over by another firm.

How can Recovery First assist?

Recovery First can assist firms wishing to exit specific areas of law. You may decide to exit a high-risk market to ensure you obtain adequate professional indemnity insurance for the rest of the firm.

Alternatively, you may be struggling to obtain professional indemnity insurance cover, and therefore, you may wish to merge your firm or plan an orderly closure.

Whatever route you choose to take for your firm, Recovery First can assist in the process by transferring your files to the most appropriate firm on our panel of solicitors, to ensure the most positive and profitable outcome is achieved for your firm.

An additional benefit is that the firm’s clients not only get a seamless transfer, but they are also married up with a firm specialised in their particular needs.

The unique scheme offered by Recovery First is suitable for law firms and professional advisors, including restructuring and insolvency solicitors, insolvency practitioners, and accountants. Our team manages the transfer of files from start to finish, placing case files with an approved law firm to protect the integrity of the client’s case.

We will provide you with all the advice and support you need, and we guarantee 100% confidentiality for all clients. If you would like to find out more about Recovery First’s process, feel free to get in touch with our Director David Johnstone at or 07887796989 or our Director Sally Dunscombe at or 07774205870.

It's never too late to speak to Recovery First. Contact us now in the strictest confidence

Sally Dunscombe:

David Johnstone:


01357 440140

Manchester Address

106 Kennedy Building

Murray Street


M4 6HS

Registered Address: 

North Torfoot



ML10 6QG