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17 June 2013

Small firms must dodge unrated insurer cycle, says Law Society

The representative body of solicitors in England and Wales has warned firms affected by the suspension of unrated Latvian professional indemnity insurer Balva to think carefully before choosing another unrated insurer.

By James Barnes

Law firms warned of unrated insurer cycle

In a statement the Law Society said that its members reported that offers had been made the broker that previously sold policies from Balva to transfer policies across to another unrated insurer, Berliner Versicherung Aktiengesellschaft.
‘The suspension of Balva by the Financial & Capital Market Commission to write new business in the UK should be a wake-up call for firms,’ said Law Society chief executive Desmond Hudson. ‘Despite the fact that Balva’s suspension does not affect its current policies, it seems increasingly unlikely that Balva will be in a position to continue to be a participating insurer next renewal.

'Matter of urgency'

‘We recognise that the 1,300 firms with Balva policies may feel pressured to obtain alternative cover as a matter of urgency and some may consider this to be a short-term solution, however, we urge firms to think carefully before simply transferring to another unrated insurer for the longer term without investigation.’

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