Rethinking insurance

I am pleased to hear that the Law Society is considering staggering the renewal dates for Professional Indemnity insurance and a return to the Solicitors Indeminty Fund (SIF) (although whether the latter is the best option is not something on which I am qualified to comment).

Clearly something drastic was needed following the insurance fiasco firms faced this summer. This resulted in a six fold rise in the number of firms that went into the Assigned Risks Pool – a place normally reserved for firms with poor claims records, or some other serious problem. As the insurers were taking their time in issuing quotes it was scary. Many of us were left imagining how awful it would be to end up in the ARP on the one hand, and then thinking surely that's impossible given that I have a completely unblemished claim free record. What I hated the most about the experience was that one was completely powerless to do anything about it. Only 3 insurers would look at IP work, so this so called competitive market place where one could shop around was simply non existent. What made matters worse was that some brokers were implying that IP was a No Go area - far too risky to entertain.

Interestingly, some of us had a meeting with Redvers Cunningham of the Bar Mutual Insurance Fund Ltd. He is also a director of PAMIA. Amazingly he told us that IP is in fact one of the lowest risk areas of work – particularly where that work is done by practitioners who specialise in the area. So, I hope the Law Society’s PII group will speak to knowledgeable individuals like Redvers when reviewing PII.

The name of the game: CONTRO£?

CONTRO£ might look more like a typo or a wheeze devised by a cybersquatter for getting more click-throughs -- but it's the name of a new scheme set up by major UK law firm Addleshaw Goddard with the aim of providing

"a cutting edge approach to funding civil litigation which reduces the cost of disputes and provides clients with more financial control and certainty during disputes than ever before". The cutting edge turns out to be conditional fee agreements, after-the-event insurance and third party funding (or a combination of all three), thus enabling their clients to be placed fully in control of the amount of risk they take. The firm adds: "We can reduce the day-to-day cost of running disputes; we can reduce (or eliminate entirely) the amount of our client's costs and expenses (including opponents' costs) if the client loses, and we can give our clients financial certainty in an inherently uncertain area.

Right: The Joys of Google Image -- search for "control freak" and on the first page of results you end up with Keira Knightly

The litigation landscape is changing dramatically ..., especially for clients who might have had a good case in the past, but ruled out making a claim because of uncertainty and potentially high costs. Our approach is very different to the standard approach by other law firms and represents a great value proposition for clients. By standing shoulder to shoulder with them, backing our judgement and sharing the risk we're demonstrating more commitment to clients than ever before".

This looks like a good topic for discussion, since there would seem to be plenty of ways in which this package of goodies can be deployed -- and plenty of opportunities for lawyers on the other side to exploit their adversaries' strength. Thoughts, anyone?