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Mark Carver provides a view on the 'four year cycle' and five questions every small firm should ask regarding their provider.


In February 2016, unrated insurer Elite Insurance announced it is withdrawing from the English and Welsh solicitors’ professional indemnity insurance (PII) market, citing deteriorating market conditions, fraud and an increased frequency of claims as the driving force behind its decision.

How did they get here?

Elite entered the solicitors PII market in 2012 focusing predominantly on solicitors in the 1-4 segment. Their market share grew rapidly and at their peak in 2013, they were writing in excess of GBP10m in premium and were insuring in excess of 1000 firms. A little under four years later; Elite has withdrawn from the market.

This raises the question; should we be surprised that another insurer has withdrawn from the solicitors PII market? Depressingly, the answer is no. If we look at the solicitors PII market as a whole; of the 28 insurers who wrote solicitors PII in the first year of the open market, only six have consistently written solicitors PII at every renewal since. Six Clerks’ own research shows us that since 2000, the average period that an insurer has written solicitors PII for is just six years. Looking specifically at the 1-4 partner space; the position is even starker, with insurers providing terms for four years before withdrawing. So, while Elite’s withdrawal is the latest headline, statistically what is clear is that there is an inevitability that other insurers will withdraw from the market in the future.

Six Clerks' own market claims data, collected since 2013 highlights:

  • Claims notifications more than doubled in 2013 compared to the average in the four years preceding
  • While claims notifications reduced in 2014, the number of notifications is still 60% higher than the four average (2009-2012)
  • Conveyancing accounts for over 50% of notifications and just under 70% of claims payments
  • Specifically in the 1-4 partner segment, we estimate since 2009 the average amount paid in PII claims per year is GBP43m
  • Even after five years, 10% of notifications to insurers will still be unresolved


This goes some way to explaining why so many insurers withdraw from the solicitors PII market after a few years.

What does this mean for small firms?

From a practical perspective, what does this mean? For those firms currently insured via Elite it is important to understand that this is an orderly withdrawal with all existing policies remaining in force until the expiry date. This means that there is no short term scramble to replace cover and that claims will continue to be honoured. However, these firms will have to arrange renewal with an alternative insurer.


We recommend that they consider the following about their PI renewal:

  • Be realistic, proactive and take ownership of your renewal
  • Obtain the insurer’s confirmed claims experience for the past six years
  • Complete a full form proposal form, such as Six Clerks', in order to ensure that there is sufficient underwriting information for insurers
  • When arranging cover through a broker, ensure they approach at least five insurers to enable them to complete a market exercise and complement this by directly approaching Six Clerks
  • Be wary of any insurers who have rapidly grown market share over the past couple of years