PII Advice - any self employed lawyers around?

[maggiethecat]

Have been looking at setting up and recently applied for PII. Surprisingly, considering the current market, got an affordable quote. Not sure if I should take it and run with - feel a bit anxious about the market and lack of readiness (it's difficult to put things properly in place until you know if you'll get affordable cover).

As I know little about the peculiarities of this area of insurance I wonder if it would be foolish to throw away this opportunity and wait for the next insurance season albeit that we're not quite ready?

I get my PII through my institute
I am scrupulously honest about the work I do, how much I bill etc and filled out the long form for the first five years
increases now settle at about 2% and my last premium was around £300 - well worth it for peace of mind

£300?? which area of law do you practise?

I'm an accountant - but all of our pii - lawyers, accountants, architects etc goes through the same brokers and risk scoring process

Solicitors pay hefty insurance premiums depending on area of practice and in some cases cannot even get cover. Wish £300 were on offer for me!

I am a self emplyed solicitor - if your quote is reasonable, I'd go for it. I don't imagine it will get much better next year, although perhaps it will one day! Each year it seems a number of insurers pull out of insuring new business, so as I said, I'd take it.
As you say, I wish I had insurance anything like £300!

Just saw this Grape. We (2 of us) did not shop around bcos of time constraints but the £8k offered was less than we were expecting since property work is involved.

As you know, market is now closed but agent has said that we can revisit in a few months' time and he will try to revive the offer.

In doing cashflow forecasts I'm trying to work out what yr 2 etc insurance might cost. So for instance, if we do the amount of business we projected we'd do in the business plan, would yr 2 insurance be the same or should we expect that it would automatically increase? (my car insurance this year had a hefty increase not bcos of any claims).

I've got PII through a broker and because I only do the odd bit of work here and there (accountancy not law though)and my annual income is fairly small, I qualify for a low earners scheme which is much, much cheaper than a general PII scheme.

If you're not completely set up and don't expect your fees to be high in the first year, I'd investigate a low earners scheme; you can always increase your cover when your business takes off.

Rocinante - that's not an option. Our regulatory body says min cover £2m - that is it, doesn't matter if you earn 1p or £1m, you have to have £2m insurance cover.
Maggie....my premiums have always increased, but so have my fees. This year my premium increase was a lower percentage than my fee increase + so I think that a small increase/stay steady if your fees do is perfectly possible.
In working out budgets etc, don't forget run off insurance....works out at double annual premium usually. Google Sole Practitionners Group for their website - useful stuff on there about PI.

grape999 - oh, ours states that if the fee income is less than £600k per annum, the cover must be at least 2.5x gross fee income with a minimum cover of £100k. It means that I'm on a scheme that only costs £140 odd per year which seems a lot more reasonable.

Many thanks Grape. I have been introduced to the awful run off insurance but I wasn't sure whether this should be factored into cashflow. I know that it is only paid if you shut shop and works out at about twice last premium paid. I suppose it is sensible to factor it in tho as it would have to be paid from somewhere unless you were taken over.

It's one of the things that has made me really think hard about whether to go for setting up.

There are so many issues to get the hang of - financial, marketing, management, regulatory and let's not forget the actual legal work . Do you mind if I ask you - how was it for you when you were setting up?

It was OK...I set up 4 years ago with 1 guaranteed client who kindly paid a bit up front to help me set up and my insurance was low to start with. I've deliberately kept small, and only got new clients through friends/places I used to work and a few local clients just through Google Ads. Main costs are certificate & PI & also CPD seminars etc, although cpdcast.com is a cheapish one for that. Sept is always stressful sorting insurance and I have to earn at least £5/6k to cover those costs which does make you wonder some times! But I love the complete flexibility of working for myself and would not want to give that up.

You've given me some useful info Grape, thanks. Altho not looking to set up a sole practice, the SPG website is a good resource.

We would try to minimise expenditure and do everything for ourselves but I'm having visions of working all hours whilst fitting in the children and house. Of course lots of things would have to get chopped.

But I love the idea of flexibility, not reporting to someone else etc. If I can work out not losing too much capital if it doesn't work out then I'll go for it. At the weekend will be sitting down with an accountant to look hard at the figures.

I run a specialist legal transcription firm and we have our insurance with Hiscox.

We would be happy to offer our services to all you self-employed lawyer ladies and are able to offer a 10 per cent discount for the first month when Mumsnet is mentioned. Our fees seriously undercut the cost of an in-house secretary and we operate a no minimum charge policy.

We transcribe all forms of legal documentation including letters, file notes, affidavits, statements and can also produce Court forms via Freeform Law.

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