After intensive lobbying by the Law Society and other stakeholders, the Solicitors Regulation Authority (SRA) has announced that it is postponing the closure of the Solicitors Indemnity Fund (SIF) by 12 months, until September 2023.
The move comes after the SRA launched a consultation in November 2021 during which it sought the views of the industry on the future of SIF, which currently provides additional winding-up cover for businesses that have closed, ensuring long-term continuous protection for customers.
The Law Society has campaigned forcefully for the retention of SIF, arguing that the shutdown would have a detrimental impact on consumers, leaving them unable to seek redress in the rare event that something goes wrong.
The SRA had previously indicated that its preferred option was to shut down the SIF, saying the cost of running it was disproportionate to the consumer benefits it offers in terms of volume and value of claims.
The President of the Law Society of England and Wales, I. Stephanie Boyce, said: “We are delighted that the SRA has listened to our concerns about the closure of SIF and instead given the fund another chance.
“Looking ahead to September 2023, the lawyers regulator will refrain from deciding the future of SIF while further work is carried out to determine whether consumer protection can be delivered more cost-effectively.
“Possible alternatives to SIF include changing the way the fund is created and managed, reducing the scope of protection it provides, or finding another consumer protection vehicle funded by the surplus. du SIF – which can also be subsidized by the profession.
“We are delighted that the SRA has heard our arguments on the importance of continuing to protect consumers, rather than running the risk of failing to do so, which would prevent consumers from claiming compensation for erroneous transactions affecting wills. , the purchase of a house or cases of bodily injury to children. .
“The Law Society stands ready to support the SRA as it explores other options.”
Notes to Editors
Read our response to the consultation in full
Find out more about the closure of the SIF
The SIF extension runs until September 2023
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