The compulsory insurance that stands behind every solicitors' firm — what cover the SRA demands, what it must include, and what happens when it runs out.
When a firm's negligence costs a client money, insurance is what makes the remedy real — which is why the SRA makes it compulsory and prescribes its terms. This chapter starts with the nature and purpose of PII, including its claims-made basis and who falls within the mandatory regime, before working through the Minimum Terms and Conditions: the cover levels for different practice structures, the civil liabilities a qualifying policy must meet, and the client protections that stop defence costs or late notification eroding what claimants receive. It then examines the separate duty to maintain adequate and appropriate cover, the limits on how far a firm may cap its liability, and the run-off cover required when a firm ceases to practise. Finally, it considers what happens when a judgment exceeds the available cover — the contrasting positions of partners and LLP members, the disciplinary consequences of practising uninsured — and the disclosures a freelance solicitor must make about falling outside the MTCs and the Compensation Fund.
