The Solicitors Regulation Authority (SRA) has been in contact with firms that are still open and covered by the Assigned Risks Pool (ARP) and given them a deadline of April to secure their own cover or close.
The 31 firms remaining in the ARP will each get a visit this month from the SRA and have already been warned that Professional Indemnity Insurance (PII) will need to be obtained by the end of March or their firms will need to be sold, merged or closed. Each firm has a dedicated SRA team member who will monitor progress.
Following the reduction of time a firm can remain in the ARP, a firm is now only allowed a maximum period of six months, the scheme is due to close by next September. There is a worry that the move may lead to many firms practising without cover.
The SRA will be checking information received from firms to ensure that policies are genuine.
Around 70 firms were forced to close in the period to December with 134 obtaining open market insurance.
As at December outstanding debt amounted to over £7 million and as such Capita have been instructed by the SRA to collect unpaid premiums “as rigorously as possible”.
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