St Paul's underlying rates for solicitors' professional indemnity insurance are set to stay the same this year.

Speaking at a reception at County Hall, St Paul's UK general manager, Martin Hudson, said: “Overall, our level of rate will remain unchanged in 2001.”

He said St Paul had taken “a lot of flak last year” from some parts of the profession that had expected lower pricing than they were offered.

Hudson predicted this could happen again this year, as rates would be set at the level necessary to pay the total cost of claims without cross-subsidy from one risk indicator to another.

He said as the legal profession had knocked £100m off its insurance bill in 2000, there was likely to be a concentration of loss ratios in a few markets.

This would lead to substantial pricing volatility in 2002, especially for small practices, many of which should regard their current insurance bill as a short-term windfall.