SRA investigates two firms over closure
The Solicitors Regulation Authority (SRA) is investigating two solicitor firms that should have closed at the end of December last year because they did not have a valid insurance policy.
The two are the only firms being investigated out of a total of 39 practising firms that entered the extended policy period (EPP) on 1 October. Of these 39, most were in the process of orderly closure, merger or acquisition, and a handful successfully obtained cover while in the EPP.
The firms being investigated are:
- Craig & Co Law Ltd (Wigan, Lancashire)
- Active Solicitors & Co Ltd (Blakenhall, Wolverhampton)
Robert Loughlin, SRA Executive Director of Operations and Quality, said: “These two firms do not appear to have valid insurance and have not closed properly so we are investigating them in order to protect the public interest. While the majority of those that entered the EPP have worked with us closely and provided assurance about their circumstances, these two have not provided us with the information we require to be satisfied that client matters have been dealt with properly.”
Initially, 49 firms were registered as entering the EPP, but this went down to 39 after the SRA received further information from some of the firms. In 2013, 287 firms entered the EPP.
The EPP of 90-days is broken down into phases: the 30-day extended indemnity period in which firms can carry on as normal as they seek to renew, then a 60-day cession period during which they cannot take on any new instructions and must plan for closure at the end of the 90 days, should they not secure a new policy.
For firms that renew their policies on 1 October, the extended policy period finishes on December 29. However, since the introduction of variable lengths of policy, not all firms will have the same EPP. SRA figures show that nearly 15 per cent of practices have now moved away from the 1 October as a renewal date.
The SRA has also published its “market share” figures for those firms that renewed on 1 October, which show how much cover has been written by those insurers providing policies for solicitor firms. These estimated premium income figures can be accessed here: www.sra.org.uk/indemnity, and by accessing the “participating insurers” section.