Half of solicitor professional indemnity claims come from either residential conveyancing or personal injury, reveals Zurich Professional...

Over half of the professional indemnity claims notified to Zurich Professional last year related to either residential conveyancing or personal injury litigation.

The study found that in 2004 over 35% of claims notified were as a result of residential conveyancing, an increase from the 2003 figure of 32%. These claims arose mainly from not conducting adequate investigations into the title to a property and not identifying and dealing with all the mortgages and other encumbrances affecting the property.

Other causes of claims from clients who had suffered loss arising from conveyancing related to searches, planning issues and appropriate advice on options of co-ownership.

Zurich Professional's Andrew Nickels said: "We are
urging solicitors to re-examine their processes for conducting residential conveyancing.

"Last year's housing boom would have resulted in an increase in competition to win business. Many solicitors may have felt under pressure to drop their rates and accelerate their usual timeframes on conveyancing work in order to compete and this could explain why we're seeing an increase in claims relating to conveyancing."

The company is urging firms to ask themselves whether they have the relevant legal knowledge and expertise, to whom do they owe a duty of care and whether there is an existing potential conflict of interest when agreeing to take on conveyancing cases.

Personal injury claims increased by over 60% in 2004 compared with 2003.

This increase was largely due to issues surrounding claims management companies. Prominent were claims arising from solicitors' involvement in The Accident Group with 'after-the-event' insurers making claims against panel firms due to alleged errors in assessing the risk when making the decision to take on personal injury 'no-win, no-fee' cases.

The study also found that claims arising from commercial property transactions increased from 2003 and constituted slightly fewer than 14% of claims received during 2004. Zurich Professional found that the majority of claims in this area related to a failure to ensure that the documentation reflected the client's instructions and not advising fully and accurately or sometimes at all) on the terms of a lease.

Issues relating to notices,searches and registration of mortgages and charges were also prominent.

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