A leading legal expert has urged brokers to ensure that law firm clients embroiled in professional indemnity claims from the collapse of The Accident Group (TAG) take special care to notify their insurers before the 1 October renewals.
Legal Risk partner Frank Maher said that although most law firms will have notified their insurers of claims received so far, this may not be sufficient to protect them if they receive further claims in the future.
He said there were already indications of further claims in the pipeline.
Firms that change insurers, or have limits on the number of policy excesses they have to pay, will be particularly at risk, Maher warned. If they calculate incorrectly they may end up paying for claims that would otherwise have been covered by insurance, he said.
Maher said: "Firms will need to be extremely careful notifying insurers of any potential claims from anyone associated with work introduced by TAG and other claims farmers.
"They could have severe problems with their insurers going forward, and may find themselves having to dig deeply into their own pockets to extricate themselves."