When underwriters consider insuring a law firm, one of the key pricing factors is the amount of conveyancing a practice does. Why?
When underwriters consider insuring a law firm, one of the key pricing factors is the amount of conveyancing a practice does. Why? The vast sums of money that insurers have paid out in conveyancing claims, notably to lenders.
Rates have risen accordingly, on occasion reaching as high as 17.5% of conveyancing fee income generated – a fact that firms should take into consideration when pricing conveyancing.
Something that recently has caused further concern for solicitors and insurers alike is the outcome in the Court of Appeal of Santander plc v RA Legal Solicitors  EWCA Civ 183. In the initial judgement, the court held that the defendant had acted in breach of trust by paying away the advance. But, having been found to have acted honestly and reasonably (as required under section 61 of the Trustee Act 1925), the court granted the defendant relief from any personal liability.
Following that, RA Legal Solicitors and their insurers could have been forgiven for celebrating a rare occasion where a lender cannot use the SRA’s minimum terms and conditions as a method of recovering losses from previous lending decisions.