Insurance companies will be allowed to take majority stake in law firms

Jonathan Djanogly

New rules that could allow insurance companies to buy a majority stake in law firms have come into force.

Under the so called ‘Tesco-law’ reforms, or alternative business structures, the rules surrounding the ownership of legal firms have been deregulated. The changes have been introduced through the previous government’s Legal Services Act, which is now being implemented

Justice minister Jonathan Djanogly said: “This is a landmark day for the UK legal industry.

“Our legal services are already rated among the best in the world, used by millions of people around the globe as well as in the UK, and these changes will set them up to move to new heights. They will enable firms to set up multi-disciplinary practices and provide opportunities for growth.”

Insurance Times reported last week that the Solicitors Regulation Authority has been flooded with inquiries from insurance-related firms about taking advantage of the new rules.