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New indemnity insurer welcomed

2 September 2010

With less than a month to go before the deadline for renewing indemnity insurance, solicitors have welcomed the arrival of a new product in the market.

The move offers hope that the number of firms forced into the assigned risks pool by their failure to find insurance might not be as high as predicted.

Alpha Insurance A/S, a Danish insurance company, is aiming its new product at firms with between one and 25 partners. It is offered through Giles Insurance Brokers and St Giles Legal and Professional Risks.

Clive Sutton, past chairman of the Sole Practitioners Group, said: “We want to encourage a spread of insurers in the market to produce a good rate. If a new insurer is prepared to insure sole practitioners, we welcome it.”

Sutton said the SPG’s preferred broker, Prime Professions, had been able to offer cover to many sole practitioners concerned by the absence of Irish insurer Quinn, through alternative insurer Travelers.

“We need a broker who can find a good deal in the good times and cover the market in the bad times,” he said.

“My guess is this year has been tougher than last year, but not as tough as anticipated. People who use brokers wisely will probably get a deal which suits them.”

Linda Lee, president of the Law Society, said many smaller firms found it very difficult to obtain indemnity insurance at a reasonable cost.

“The announcement that there will be a new provider specifically aimed at the smaller firms of one to 25 partners entering the market is a real boost,” she said.

“For a variety of reasons, some smaller firms had a limited choice of insurers, but the arrival of Alpha Insurance into the market provides an additional option for members at a crucial time.”

Malcolm Gordon, managing director of St Giles Legal and Professional Risks, said the new product was backed by “solid reinsurance” in the form of Greenlight Re.

“We will run this with a team that includes people who themselves were once solicitors in private practice,” he said. “A pro-active claims service is a key part of our offering.”

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Regulators Legal Aid Financial services & Tax