The Solicitors Regulation Authority (SRA) regulates the conduct and standards of all solicitors and solicitors’ practices in England and Wales.

Since 1 October 2023, the SRA has been responsible for operating the Solicitors Indemnity Fund (SIF). The SIF was established to protect consumers of legal services by helping those who might have suffered loss through no fault of their own when using legal services provided by individuals and/or firms regulated by the SRA. The SIF will look to respond in circumstances where a firm’s insurance cover is no longer active. In other words, the SIF will look to protect clients concerning post-six-year negligence claims.

As part of those arrangements, the SRA has appointed Lester Aldridge to manage and handle claims made on the SIF on its behalf.

You can find further information about the SIF, including information about whether you can apply, the application process and the rules upon which decisions will be made on the SRA’s website.

What is a post-six-year negligence claim?

When a law firm closes, it must put in place run-off cover to protect solicitors and their clients in the event of any civil claims that arise because of negligence. Run-off cover must provide cover to the firm for a minimum period of six years after it has closed.

Any claims made within the six-year period after the firm has closed should be made against the insurer responsible for providing run-off cover. You can request details of a law firm’s run-off cover by writing to insurerdisclosure@sra.org.uk.

If a claim is made after the six-year period, it may be that the SIF will provide indemnity in respect of that claim, subject to certain criteria being met.

Why is the SIF required?

There is a risk that, in some areas of law, clients may not become aware of a potential claim until the six-year run-off period has expired. In those circumstances, it may be that the SIF will provide indemnity for the loss.

What is a successor practice?

The SRA’s Standards and Regulations Glossary defines the term “successor practice”.

In some circumstances, the insurer of a successor practice will be required to cover claims against the firm that has closed. In those circumstances, your claim should be directed to the successor firm/its insurers, rather than to the SIF.

The definition of “successor practice” is complex. You may wish to seek independent legal advice about that if you think it applies to your claim.

What if the firm did not have insurance or run-off cover?

If you suffer a loss which should have been covered by a firm’s compulsory indemnity insurance, but it turns out that the firm had failed to have such insurance in place, you may be able to apply to the SRA’s Compensation Fund.

You can find further information about applications relating to uninsured law firms on the SRA’s Compensation Fund on the SRA’s website.

Is the SIF and the SRA’s Compensation Fund the same thing?

No, the SIF and the Compensation Fund are not the same.

SIF

The SIF is in place to protect clients in respect of claims against a solicitor or a firm in circumstances where:

1. You have suffered loss as a result of a negligent act on the part of a solicitor/firm, and
2. That firm is no longer trading, and insurance coverage is no longer active.

Any claims made to the SIF must be made within the time limits prescribed in the Limitation Act 1980. A payment will be made if the claim meets the conditions specified in the Solicitors Indemnity Rules, as amended from time to time.

Compensation Fund

The Compensation Fund is a discretionary fund that aims to protect clients when a client has suffered a loss caused by a solicitor/firm’s dishonesty or failure to account. A separate set of rules governs the Compensation Fund.

You can find further information about the SRA’s Compensation Fund, including information about whether you can apply, the application process and the rules upon which decisions will be made on the SRA’s website.

How can I contact you?

You can contact us by post, email or telephone as follows:

• By post: Solicitors Indemnity Fund, c/o Lester Aldridge LLP, Russell House, Oxford Road, Bournemouth BH8 8EX (quoting ref: 3.SRA.SIF)
• By email: SIF@LA-Law.com
• By telephone: 01202 786340