The rule change applies from 2023 to all firms regulated by the Council for Licensed Conveyancers (CLC). Insurers receiving applications will be required to respond no less than one month before the 1 June deadline, in order to reduce the risks involved when firms and insurers take renewal to the wire (30 June cut-off).
The rule change, agreed by the CLC, aims to give practices enough time to seek alternative cover if needed.
The CLC will also require an automatic 90-day extension of cover in the event a practice is unable to renew, with the last insurer paid a pro rata premium based on the most recent policy. During the extended cover period, the practice will be barred from taking on new work. If the firm succeeds in finding a new insurer during the extended cover period, the new policy must be backdated to 1 July.
However, these new requirements will not apply where a firm’s insurer has notified the firm and CLC by 31 March that it will not renew.
CLC director of strategy and external relations Stephen Ward said: ‘We believe that the package of reforms we have agreed with the LSB are fair to both our regulated community and insurers alike, and at the same time meet our primary responsibility to protect the public interest.
‘A robust and sustainable professional indemnity insurance scheme is a cornerstone of our regulatory approach, and we will continue to monitor its effectiveness during the renewal round, as we do every year.’
Ward said the CLC will also review policy on cyber-cover, as there is ‘significant support for mandatory cover but also concern about its cost and the wide variations in what is provided by different policies’.
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