Was I naïve?
Back in February I was bright eyed and bushy tailed, I had made the decision to be a master of my own destiny and set up a CLC regulated law firm. I shared an article with you back in May. Little did I know or appreciate the turbulent time ahead.
I didn’t receive my insurance quote in May, instead I faced the July renewal season. Even though I was a start-up the feedback advised the insurers priority was to focus on renewals to understand their risk book before they considered a start-up. I did not know where my application had been sitting since Feb/March. I had no choice but to wait for the renewal to be completed. The week of renewal one of the recommended insurers pulled out of the market forcing the remaining insurers to focus on existing businesses. My hope was diminishing fast. I was receiving conflicting information and little progress.
I decided to reach out to The Society of Licensed Conveyancers for support. I was delighted with their response and help, particular thanks to Mike Ockenden for his efforts. I was acutely aware it was a hardened market. Other start-ups had been refused insurance. Existing, successful law firms had not been offered an insurance renewal.
The most frustrating part of the process was not being able to engage with an underwriter, not to have a meeting to discuss the business proposition or answer any specific questions. I started to doubt whether I had provided sufficient detail, clarity on our risk management, shared our operating model. Was it the model, the process, the market or a mixture and what could I do, if anything to influence?
Not to be deterred I provided further information relating to Governance, Risk, IT, Policies, Procedures, Controls. I included system presentations on how we lock down email addresses, phone numbers, risk grade every case auto updating as the case progresses, financial management information, audit selection, operational management. If insurance wasn’t going to be offered, I wanted to understand why. I was prepared to walk away from certain aspects of the plan if necessary, such as acting for both buyer and seller (subject to rules and regulations) or probate work.
Eventually after many months we received a quotation.
I was delighted, but it was also time to reflect. We are a proud regulated community providing a service to set standards and outcomes. We work within frameworks embracing new technologies to create streamlined processes for business and clients. We provide transparency on turnaround times, expectations, and feedback. It is ironic the same standards did not appear to exist when seeking insurance. But we also need to recognise we are working in difficult challenging times. COVID, SDLT/LTT, remote working, increased volumes unfortunately resulting in increased risk changed the legal landscape in what appeared to be a blink of an eye.
In retrospect I was naïve believing the process would be straight forward. I am certain as an industry we can do more to share our experiences to help and support each other and new entrants. We should provide more transparency and set realistic turnaround times, perhaps even publish how many new start-ups have been accepted versus those that have been rejected with reasoning. Do we have an appetite to bring together market leaders to review business plans, financial projections, investments, volumes and audit functions? We have recommended insurers, do we have recommended suppliers for outsourced functions e.g. The Cashroom. I am certain as a collective we can do more to support our industry.
I am truly thankful to The Society of Licensed Conveyancers, The Council of Licensed Conveyancers, and our insurance broker for their support to date. The next phase for Sail Legal is regulation working closely with The Council of Licensed Conveyancers. So far, the process of providing documentation and receiving feedback has been a breath of fresh air. Fingers crossed it won’t be too long now.
Sarah Ryan is Managing Director at Sail Legal