Balva was third biggest indemnity insurer

Latvian insurer Balva's position in the indemnity insurance market was underlined yesterday when a Law Society guide showed that it was the third biggest insurer in the current indemnity year.

The SRA announced that it was considering banning solicitors from using unrated insurers last week, after it emerged that Balva, which insured around 1300 firms, was being wound up and the Latvian regulator withdrew permission for it to write further policies.

Ranking above well-established names like Zurich and First Title, Balva Insurance had 9 per cent of the indemnity market by number of firms insured.

The leading insurer was XL, with 23 per cent, followed by Travelers, with 15 per cent. However, XL's share of the market fell by 2 per cent, while Travelers only grew its share by 1 per cent. Balva's share grew by 7 per cent, faster than any other insurer.

Zurich was in fourth place, with 8 per cent, followed by First Title and QBE, each with 7 per cent. Allianz and Chartis insured 4 per cent of firms. Alpha Insurance, an unrated insurer, insured 3 per cent of firms, as did Axis.

The Law Society 2013-14 Insurers' Guide listed unrated insurers still in the market, such as Alpha and Elite Insurance, but reminded solicitors of the importance of "the financial security of your insurer".

In a separate Buyer's Guide the society said that an unrated insurer was an "unknown quantity" and urged solicitors to be aware of the risks.

The guide also included a section on understanding insurers' ratings from AM Best and Standard and Poor's.

It gave a list of the main brokers, based on a society survey carried out in April this year, involving 600 firms from sole practitioners to those with 25 partners.

Aon Risk Solutions, with 42 per cent of the market, was almost twice the size of its nearest rival, followed by Prime Professions with 22 per cent and Lockton with 17 per cent.

Giles and Marsh had 7 per cent each, 1 per cent more than Bar Professions and Hera Indemnity.