From yesterday afternoon Lockton started to receive many calls from worried clients, having received an email from the SRA saying that they had not obtained PII cover and must therefore stop trading.

We understand that more than 1,000 firms may have received such emails 'in error'. The problem appears to be two-fold.

The simpler problem is those firms that have been late in processing their premium payment, which may have delayed confirmation of cover being sent to the SRA.

More worrying are the firms that are fully paid up, who still received such a message.

Discrepancies in databases

The SRA have changed their internal processes this year and it appears that where the following items do not match exactly as between the insurers' lists and the SRA database, the SRA may have viewed the entity as being uninsured:

• trading styles/related corporate entities not specifically listed on the insurance certificate (NB policy wordings ensure that all relevant trustee, nominee companies and trading styles are covered in any case-  and this has therefore not been an issue in previous years).
• minor differences in firm name as between the certificate of insurance and the SRA database (eg one says 'Ltd', the other 'Limited')
• discrepancies between principle office addresses/SRA number

Insurers were pressing the SRA as early as last week for a copy of the SRA list, in order that they could address any anomalies. As it stands, the SRA is still awaiting a decision from their legal advisers as to whether they can release this list to insurers.

Please note - this is a problem across the board, and not one affecting just one broker's clients or one insurer.

How Lockton can assist

We are actively engaging with both the SRA and insurers to clear up any anomalies as quickly as possible.  If you have received an email of this nature from the SRA and believe it is in error, contact your broker immediately.

We are issuing amended Certificates of Insurance to affected firms, which list all the associated entities, including Trustee and Nominee companies, for the avoidance of doubt. We would however stress that your policy wording does extend cover to all such entities as a matter of course.

If there any inconsistencies as regards the primary office address in your proposal form, and the firm's registered address as notified to the SRA, again please let us know as soon as possible, so that we can assist resolve this on your behalf.