Lawcovernotes March 2015

Lvl 13, 383 Kent St, Sydney NSW 2000 Australia DX 13013 Sydney Market Street Telephone (02) 9264 8855 | Facsimile (02) 9264 8844 lawcover@lawcover.com.au | lawcover.com.au Lawcover Pty Ltd | ABN 48 003 326 618 Lawcover Insurance Pty Ltd | ABN 15 095 082 509 Welcome It is two and a half years since I joined Lawcover as Chief Executive Officer and as another insurance renewal period approaches, I have been reflecting on my dialogue with the profession since then. It would be fair to condense what has been a common theme into three areas – “Service, Support and Affordability” MARCH 2015 EDITION 6 I recently revisited the first issue of Lawcovernotes published in May 2013, in which as the relatively new CEO of Lawcover, I wrote: “ …I am also aware that there are challenges. In my discussions with insured solicitors, there has been an expression of concern surrounding the issue of premiums, loadings and excesses. […] I have made it one of my key objectives to assess how we can work to put downward pressure on both the cost and frequency of claims and as a consequence, provide predictability and affordability to the premiums you pay.” Better than anticipated results in prior years has provided an opportunity for management and the Board at Lawcover to reassess the models on which we anticipate future claims costs, with a view to reducing premiums. We do this by carefully examining underlying claims experience and trends using complex actuarial models, the outcomes of which are considered against a backdrop of a strong capital position, efficient reinsurance structures and sound prudential management. In the last edition of Lawcovernotes I referred to the Policyholder Rebate which was paid to eligible law practices in September 2014. The rebate arose from overall positive claims trends and outcomes in the years prior to 2014/15, which were better than originally anticipated. The entire Lawcover team was delighted with this outcome. So it is with considerable pleasure in 2015 I can report that Lawcover’s base insurance premiums* for the 2015/16 year, on a like-for-like basis, will again reduce - for some law practices for the second year in a row. Please note that this is dependent on movements in a law practice’s gross fees, claims experience and therefore the actual premiumcharged. The frequency and severity of claims against insured law practices continues to be stable and below modelled expectations. I believe this is in part due to the profession embracing the concepts of good legal practice together with the claims prevention strategies promoted by our experienced and dedicated Practice Support Services team. I commend their activities and draw your attention to the numerous risk management events listed within this issue of Lawcovernotes. Lawcover remains committed to providing our insured law practices with the highest standards of service together with the broadest level of insurance at a sustainable and affordable cost. Our positive results will not diminish that commitment for continued improvement in meeting both your professional indemnity needs and your expectations. Our focus remains constant – Service, Support and Affordability. Michael Halliday Chief Executive Officer * base premium means the professional indemnity insurance premium for the primary $2m layer of insurance, excluding stamp duty, taxes, claims loadings and adjustments. PDF VERSION