A confidential free helpline for legal firms from Symphony Legal

Guest article written by Viv Williams, Consulting Director, Symphony Legal

The past few weeks have seen local lockdowns imposed and new nationwide restrictive measures announced in an attempt to keep Covid-19 under control.

The announcement by Rishi Sunak of the new Winter Economy Plan to include a new wage subsidy plan to replace furlough and an extension of business loans will come as a welcome relief for some. However, it is not thought to be as far reaching as existing schemes in place with redundancies still expected and some legal firms having to seriously consider their options.

Covid-19 has created a raft of problems

In many firms I talk to they are anticipating anywhere between a 30% to 50% loss of turnover in the current financial year. There are exceptions; of course, most conveyancing practices are working flat out to deal with the volume of work coming through the doors which is pre-lockdown work that has just been waiting to happen. However if we continue to see the redundancies mounting, this has to question the long term stability of the economy. A recession is looming and it could well be a long road to any form of recovery and not the V shaped recovery some have predicted. This new phase has started with firms making redundancies to highly paid individuals in non-fee earning roles such as HR directors, marketing directors and business development senior roles.

Do we need the amount of office space we had? What services can we profitably offer? Can staff remain working from home? These are just some of the questions currently being contemplated by the owners of law firms. Some are even asking “Do we wish to continue at all?” and “Shall we merge our practice - that’s if a merger partner can be found in the current climate?” Law firm leaders have a mountain of concerns to agonize over, not least “How do we adopt a strategy in these uncertain times?”

The hardest PII market for years

Despite the reduction in turnover for most firms we are facing one of the hardest professional indemnity markets we have seen for many years. Some firms are facing substantial increases in premiums due in October, others cannot even get cover. Expect a 15% to 20% rise in premiums and then comes the question of obtaining funding for the premiums. Those firms with either CIBLS loans or BBLS loans recognise that although they have been invaluable in the short term they still need to be repaid and are considered a liability when looking for additional funding for professional indemnity premium.

Howden Commentary

The combination of a hard market and the added complications borne out of Covid-19, is proving extremely challenging for solicitors renewing their Professional Indemnity Insurance. PII Proposal forms are longer, insurers' appetite for new business is much limited, premiums are higher and more firms are seeking help with premium funding. The task of running a successful legal practice has never been more difficult and any assistance in helping businesses to survive must be welcomed.

Neil Pointon, Associate Director, Professional Indemnity, Howden
E: [email protected]
T: 07967 099508

Help is at Hand

If you are facing any issues regarding some of the concerns highlighted above or simply would like to have a confidential chat about your future direction, Howden has teamed up with Viv Williams of Symphony Legal who will discuss your options confidentially and help you find a solution. There is no charge for an initial consultation and this can be arranged by telephone, Zoom or Teams.

If you would like to take advantage of this free service please contact Viv directly on:

E: [email protected]
T: 03339 207124