Through the mutuality of Law South supported by its dedicated risk team, its brokers (Marsh), its primary insurers (currently Aviva (lead), AIG & Everest) and its offshore captive (Meridies), all Law South member firms receive considerable benefits both collectively and individually which are regularly benchmarked. Insurers value highly Law South because of the strong level of best practice activity, good claims record and the captive insurance firm which make Law South premiums more stable over time. The group enjoys a lower Total Cost of Risk – lower retentions, premiums and brokerage. The group has enhanced risk management with all firms adopting the Law South Risk and Compliance Standard and professional input from Marsh and Teal Compliance (Help Desk, ‘Gold Standard’ policy set and enhanced controls and data). Activity includes: Sharing experiences, Root Cause Analysis, sharing of sources of claims, comparative claims records, identifying areas for improvement; regular reports of trends & developments; monitoring of emerging claims; and allied training to common themes and specifically identified legal disciplines.
The professional indemnity insurance arrangements are a key part of the risk management programme operated by Law South for its member firms. The arrangements include:
· An off-shore captive insurance company (Meridies) providing cover for the excess layer before attachment to the qualifying insurer. Excesses depend on turnover and premium is calculated according to a combination of the individual firm’s claims history and the claims performance of the group as a whole for an individual indemnity year.
· Law South’s brokers (Marsh) negotiate the best overall primary cover for the member firms. Marsh work with each firm to consider their individual needs and to select the appropriate level and source of top-up for cover in excess of the primary layer. The combined approach brings benefits from joint buying power in respect of compulsory cover and top up layers as well as an excellent quality of brokerage at a preferential price.
· Primary cover provided by Aviva, AIG and Everest. This includes enhanced policy wording in excess of the minimum standard terms. Member firms also benefit from more attractive premium rates when compared to the market rate due to the importance placed by the underwriters on the group-wide risk management programme and the emphasis on continuous improvement.
· Support from the central Risk Management team and strategic compliance partner, Teal Compliance Limited, on all aspects of best practice principles relating to the management of a modern law firm. As well as contributing to the lower premiums offered by insurers, the central risk management resource enables member firms to learn from the mutual experiences of all members whilst retaining an appropriate level of confidentiality in respect of particular claims.