In the absence of a face-to-face meeting with insurers, your proposal form and renewal submission are the face of your firm when they are considering your practice and the risk it presents. Below, our Solicitors' PII specialist Kerry Greenwood provides some top tips on how to best present your firm to insurers.
A well-presented and comprehensive submission is essential to ensuring you get the best possible outcome when it comes to your renewal.
1. Plan ahead
Don’t leave thinking about your renewal until the last minute. Agree an organised plan with your broker well ahead of your actual renewal date. A lot of information is needed to complete your proposal effectively, some of which will take time to compile. Understand what information and data is required and identify who within the business can help in collating this.
It’s also vital to provide up to date information. Consider what you have supplied historically - having a copy of your firm’s last completed proposal form and any other information previously provided can be a useful starting place - review whether this is still accurate, and clearly explain any changes that have been made.
2. Take care of the basics
An illegible, incomplete or error loaded proposal form is not the best first impression when it comes to insurers considering your firm. Where possible, type your answers onto the proposal form. If this is not possible, make sure your writing is clear and legible.
Insurers need a complete picture of your firm so answer all the questions on the proposal form. An incomplete form will slow down the process and have insurers wondering whether (at best), your approach to your firm’s risk is not thorough enough, or (at worst) that you are intentionally trying to withhold information. Where additional or supporting information is requested, make sure everything is included within your submission, ensuring sufficient detail is provided. One-word answers are unlikely to provide enough detail for insurers to get a proper understanding, however supplying your complete office manual is likely to be over kill.
3. Go beyond the proposal form if needed
Every firm, no matter what shape or size, should use the renewal as an opportunity to tell insurers what makes them different. For many firms the proposal form may not always provide enough information to adequately represent the practice to insurers. For example, where a practice has had historic issues or where there have been changes within the firm, it’s important to tackle these head on rather than shy away or hope they won’t be noticed.
Whilst every firm is unique and will need to include different information, consideration should be given to preparing the following to support your proposal form:
Executive summary and practice overview – including but not limited to, firm structure, any recent changes, future plans and the firm’s culture and ethos.
Financial viability – Insurers want to understand the financial viability of a business, particularly given the current climate. Most proposal forms request information around this topic or ask for a copy of the firm’s accounts. If there are anomalies or issues, explain these, including what action is being/has already been done to overcome and rectify these.
Claims issues – explain any changes in loss frequency, large claims, open or ongoing matters or patterns associated with specific work types, offices or individuals. Most importantly comment on what the practice have done to prevent a reoccurrence, highlighting:
• The role your leadership team has in monitoring claims and trends
• What scoping exercises have been done to identify the extent of any wider problems, including file reviews and ring-fencing any issues
• Corrections and changes to processes and the culture within the firm
• Preventative steps to re-educate staff and embed permanent firm-wide changes.
Regulatory and disciplinary proceedings – explain any issues, the stage you are at in the proceedings and any outcomes if these have been determined.
Supervision and risk management – include information on compliance, your systems and procedures and file audits, as well as how you identify and manage risk. Also include an explanation of how supervision works within the firm and how this has been adapted to accommodate hybrid working.
4. Provide comprehensive breakdowns of any conveyancing work
This is a particular area of concern for insurers right now, given the possibility of a recession and the historic pattern of increased claims that have followed in previous times. There are some common areas that insurers perceive to be higher risk (usually as a result of claims), so provide a comprehensive breakdown of work and details around how you handle:
• Overseas work
• Buyer Funded Development and Investment Schemes
• Multi Dwelling Relief
• Escalating Ground Rent
• Equity Release
• Any significant influx of work during the stamp duty holiday.
You may choose not to undertake work in these areas and highlighting that this forms part of your firm’s risk assessment process can be useful.
5. Boutique and specialist firms - detail the work you undertake
If you work in a niche area of law, there is little opportunity to explain what you do on most proposal forms. Providing additional information on the type of work your firm undertakes can help ensure that insurers have a better understanding of your risk profile.
6. Explain what cyber security your firm has in place
Another increasing area of concern and insurers will want to understand what cyber security your firm has in place. Some insurers want to see that firms have Multi Factor Authentication, are using up to date and supported software and systems, and are providing regular cyber security training for all staff.
The SRA and Law Society websites provide useful guidance on this:
SRA | Risk Outlook report: information security and cybercrime in a new normal | Solicitors Regulation Authority
Cybersecurity when working from home | The Law Society
7. Mergers and acquisitions
Likely to be a continuing trend, if this is something you are considering then you should provide insurers with details of your due diligence strategies, the management and integration process and whether the firm will become a successor practice. An early discussion with your broker and/or insurer before any heads of terms are agreed is crucial.
Insurers will be asking questions around sanctions and you should provide clear details on the checks the firm undertake and the training that staff have received on these requirements. Showing that you understand your client base and exposure is essential. There are guidance notes on the SRA website:
SRA | Complying with the UK Sanctions Regime | Solicitors Regulation Authority
Your renewal is a great opportunity to tell insurers what you do well and by helping them to understand your practice and have comfort around any unusual or difficult areas, you will assist them to make a better assessment of your firm.
Here at Miller we pride ourselves on offering a service that is prompt, professional and personal. We will review your submission before it is presented to insurers and offer constructive advice on any improvements that can be made if appropriate. We will engage with you to fully understand what you do so that we can effectively present your firm and negotiate the best deal.
We are a highly experienced team who thrive on helping our clients and delivering a PII solution that is tailored to your exact requirements. We believe that no two firms are the same, so let us help you present yourself in a way that achieves the best results.