As much of the legal sector prepares for the 1 October professional indemnity insurance renewal, Amy Bell and Samantha Pye look at the elements required in building a strong presentation for potential insurers.
In the past twelve months, we have seen the pressures on firms continue to grow amid furloughs, lockdowns, and the stamp duty holiday. Disruption, staff shortages and mounting workloads are factors that can lead to the breakdown of some of your usual risk management processes, and this raises concerns for underwriters. In addition, insurer premiums are rising due to various factors, making it difficult for firms to secure the right cover at an affordable cost.
To secure the best possible terms on your cover amid these challenging conditions, firms must demonstrate effective management of claims risks. We recommend reviewing some key areas to present your business in the best possible light to insurers.
Supervision and file reviews
Firstly - it is crucial to determine whether your staff are following procedures correctly.
While the recent global disruption will undoubtedly have caused challenges to your existing processes, it is important to demonstrate that you have adapted to whatever the 'new normal' is for your firm.
Supervision will help you determine whether employees across the firm are conducting legal work correctly. Firms should consider whether increased home-based and hybrid working has affected the way staff follow procedures.
It is also vital to ensure that administrative errors are picked up, given that the vast majority of mistakes do not relate to the law at all. File reviews improve the likelihood that employees will record dates accurately, take notes, progress matters, and maintain strong client communication.
Undoubtedly, many firms will have had fewer opportunities to overhear whether someone is struggling, and in some cases, managers will choose to skip one-to-one meetings. To counter this, it may help to schedule more regular catch-ups or team meetings to discuss issues.
Given the above, it is also vital to get reviews back on track. It might be appropriate to conduct more reviews/meetings to ensure employees can manage their cases.
Training has always been an important element of the legal profession. While this will likely have taken a new shape during the last 18 months, now is the time to review it to ensure it meets the standards of your firm.
Recent recruits will likely have received a different kind of training from their colleagues due to the constraints of the global pandemic. If there are gaps in the knowledge of junior team members, these will soon start to present themselves and may lead to complaints or claims under the PII policy.
While training largely remains remote, employers should take the time to schedule follow-up meetings to make sure this has been digested and understood.
From experience, these issues can be messy and time-consuming to untangle, so it is best to avoid them in the first place. Insurers expect training and professional development to form a fundamental part of your practice and will be interested to know what you are doing.
Learning by watching and listening to others helps us to assimilate ideas, knowledge and even technical skills. Hearing others in your team explain a problem or deal with an issue provides a valuable resource. Many law firms have coped despite a fragmented workforce, with some staff members completely isolated when dealing with numerous challenges, often completely alone. It remains vital to check in regularly with employees to ensure they are coping with their workloads.
Managing caseload capacity
Solicitors often face enormous pressure in their roles due to incredibly tight, often unavoidable deadlines. In reality, it is very easy to miss a deadline when you are struggling, feeling overwhelmed or overloaded with work. In order to maintain good risk management practices, it is paramount to be aware of what your colleagues have on their desks.
Caseloads are a big topic of conversation for law firms, and with good reason. But it is hard to achieve the perfect balance. To keep things manageable and organised, you should maintain a detailed, relevant checklist. This should include information on necessary steps, documents, strategies and deadlines for cases, while also identifying the parties involved in the process.
The optimal caseload allows firms to be profitable and solicitors to achieve a good work-life balance. It is okay to ask for help, say no to client demands and choose not to take on any more instructions. Many firms closed their doors to new conveyancing instructions during the stamp duty relief period because the pressures became too much for their team. This won't be appropriate for all and may not be right for your practice, but it shows one of the many ways that firms have chosen to mitigate risk.
Adapting existing procedures for a new environment
In the vast majority of cases (excluding sole partners or very small practices) old policies will not be fit for purpose. A classic but simple example of this is confidential waste disposal. In an office environment, there may be a confidential waste bin or shredder but how does this work at home? There are ways to check compliance in the office – you can go through bins if you are so inclined – but it's not so easy when working remotely.
Those operating on a network may have experienced difficulties when printing documents on a local printer. This often means sending documents to a personal email, on perhaps an unsecured laptop. In which case, it is unlikely this will meet client confidentiality requirements or comply with data protection laws.
It is crucial to ask yourself: “does this policy work for our new set up?” If the answer is yes, you are winning. However, it is more likely that certain aspects will need to be amended and enhanced for remote working.
Technology should also be reviewed to check that it is covering all the things you need it to do. In the coming months workplaces will see a variety of requests for agile working and there is no one-size-fits-all solution. All you can do is adapt your processes and procedures and make sure that it works for you.
Culture is important to compliance but cannot really be taught. It comes from working in an office environment surrounded by people doing the same or similar job. To counter this, you need to build a strong, clear compliance framework that everyone understands and buys into.
We regularly add guidance notes, templates and content to our client portal, but if you need help with something specific, please contact your usual Lockton Account Executive who will be delighted to help.