Falling cost: PII premiums back to pre-recession levels
After all the predictions of solicitors’ professional indemnity insurance (PII) premiums going through the roof, figures from the Solicitors Regulation Authority show a 15% fall across the profession for 2010/11, back to pre-recession levels. However, there has been a massive 57% jump in the number of firms in the assigned risks pool (ARP).
Solicitors paid £213.6m for the compulsory primary layer of cover, down from £246m in 2009/10 and £226m in 2008/9. It was £205m and £211m the two years before that.
There will be speculation that some of the fall is down to law firms closing because of the quotes they received for PII, while a massive rise in the number of firms unable to find insurance and so falling into the ARP will also have contributed.
The 30 days that firms without insurance had to secure and backdate cover has now passed with 337 firms still in the ARP(down from 383 last week). Before renewal there were around 214 firms in the pool.
Insurers’ contribution to the costs of the assigned risks pool is based directly on their market shares.
Last year’s market leader Chartis (formerly AIG) increased its market share to 18.1%, with last year’s two big entrants, Hannover and XL, hurtling up into second and third place with 14.4% and 13.3% respectively. Zurich maintained its share at 12.9% but Travelers fell to 11%.
Rounding out the top 10 are QBE (8.2%), Allianz (6.4%), Aviva (4.2%), Lemma (2.9%) and Royal & SunAlliance (2.2%). Two of the 22 qualifying insurers took on no risks, while nine others wrote less than 1%.
NB This story was revised after originally posting when updated figures on the number of firms in the ARP were received.
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