How Do You Solve a Problem Like Professional Indemnity Insurance?
Today’s Conveyancer reports that that latest information indicates PII premiums increased by 27% on average in Late 2021. In October 2020, they had risen by an average of 21%, up from 17% in April of the same year.
Clearly, this level of consistent increase is unsustainable for many SME firms, but even larger firms may find themselves struggling. Though firms experienced an income boost during the Chancellor’s Stamp Duty holiday as the property market surged, that sort of activity is unlikely to repeat itself anytime soon.
With a cost of living crisis, the slow recover from Covid-19 and a number of other factors, the property market may not see another such surge for some time to come.
It isn’t just the level of premiums which may cause issues. The marked increase in claims against firms and the scrutiny this has invited mean that some insurers are now also demanding personal guarantees in order to provide cover, leaving solicitors and their firms considering the real possibility of putting their own personal assets on the line in order to obtain cover.
Between this and news that the SRA is seeking to raise the levels of fines it can apply to firms, as well as the dwindling number of insurers in the PII market, the picture is grim indeed.
A large number of the claims being made against firms in recent years relate to Stamp Duty Land Tax. Between the confusion caused by various changes like the Higher Rate on Additional Dwellings surcharge and the limitations of the HMRC calculator when it comes to the 49 (and counting) reliefs which apply to SDLT, mistakes are more common than they should be.
A new wave of ‘Claim Farm’ firms have seized on this, with PPI now no longer available, and are writing to consumers en masse, encouraging claims against solicitors for these errors.
Happily, there is a solution.
Compass has been designed from conception to be a tool which can indemnify solicitors against costly errors, while ensuring that their clients pay the correct amount of SDLT first time, every time. Built in consultation with tax experts and conveyancing solicitors, Compass is the first completely accurate SDLT Calculator.
It is intuitively laid out to ensure ease of use, regularly updated to take account of any changes to the legislation, and fully complaint with the CQS requirements as laid out by the Law Society in 2019.
By using Compass, you have the benefit of a comprehensive system with referral to expert advisers in marginal or complex cases. The system not only calculates the SDLT due on any transaction, but also produces a fully CQS compliant audit trail for each transaction.
It is also easily incorporated into any existing Case Management System, ensuring minimal disruption and maximum benefit.
Outsourcing of the risk inherent in SDLT in this way can only benefit a firm. With the calculation being done by a fully insured third party, you immediately remove the risk of claims against you in this growing area of concern. Fewer claims means lower risk, which should translate to lower PII premiums as well as a happier client base.
See how your firm could join the growing number of UK conveyancers benefiting from the Compass Difference.
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