We are pleased to announce that the results from the first ever survey of law firm risk management and professional indemnity insurance within Australian law firms are now available.

The Professional Risk and Insurance Report 2009 provides Australian law firms with insight into the concerns and practices of their peers, and provides benchmarks for their future professional indemnity insurance purchasing and implementation decisions.

Survey responses were received from firms in revenue bands ranging from under $20 million to over $400 million and from all capital cities except Canberra, together with some regional centres.  90% of respondents were CEO/managing partners or risk/Insurance partners.

A key finding is that fewer than 50% of respondents rated themselves ‘well prepared’ to manage the risks they identified. Yet in today’s hardening global insurance market it is more important than ever to be and be seen to be a ‘good risk’ to obtain appropriate cover that represents value for money.

Whether you participated in the survey or not, the Professional Risk and Insurance Report 2009 report contains valuable and thought provoking insights to help you benchmark your approach on risk and insurance against firms in your peer group. 

Legal Banana Skins is a joint initiative of independent consultants Colin Smith, Strategic Insurance & Risk Solutions (SIRS) and Ronwyn North, Streeton Consulting. Our sincere thanks to all those who supported and participated in this Australian first. 

Report content and its value to you

Click here to view the summary table of issues covered in this Report that will assist you to benchmark your firm against your peers.

The survey findings are reported for respondents overall and in peer group bands based on turnover. This means you can readily benchmark your firm’s approach and buying decisions against your existing peer group, and future peer group if you firm is on the cusp of a revenue band or has aspirations to grow. The peer group bands are:

Report highlights include findings, comparisons and commentary on:

• Top risk concerns  and the interesting differences between unprompted and prompted responses (e.g.  comparison between risk of a major claim, reputational risk, anti-money laundering, managing in a difficult economic climate, business continuity and other operational risks and management of overseas risk)
• Top risk management priorities and extent of match, and seeming mismatch, to risk concerns (e.g. use of risk culture, risk policies, risk education, incident reporting and debriefing).
• Structure of the risk/insurance function and how many firms have dedicated risk positions and provide fee relief
• Spending on risk management and training
• Claims trends including notifiable incidents
• Insurance cover purchased and level of self-insured excess
• Insurance arrangements including:
  • the most commonly used compulsory schemes;
• the brokers and excess layer underwriters in Australia and the UK providing advice and coverage to Australian law firms;
• the size of firms that make presentations to UK underwriters;
• reasons that firms have changed brokers or underwriters;
• the use of a captive insurance company; and
• additional practice insurance such as D&O, Management Liability and Employment Practices Liability or for other advisory/business (i.e. non-legal) services .

Colin Smith, SIRS, is a leading adviser on professional indemnity insurance and Ronwyn North, Streeton Consulting, is the pre-eminent legal risk management adviser and trainer in Australia. CV’s can be reviewed here.

Over many years SIRS has represented major law and other professional firms in securing optimal professional indemnity (PI) insurance.