A £77m professional indemnity claim against an accountancy firm due to hit the London market has been slashed to just over £10m.

According to Willis, the broker embroiled in the claim, the initial estimate has been reduced to £12m.

Although constrained by confidentiality, Willis executive director Joanne Willmore said that despite speculation that a London firm was involved in the claim, it was made against a regional firm.

Willmore said the case was an example of the threat that under-insurance posed to professional firms, particularly SMEs.

"It may well be that firms need to increase their level of indemnity," she said.

Willmore said research by Willis had shown that firms were not using premium savings to buy additional cover, nor increasing indemnity limits to match inflation.