Common pitfalls factsheet
Produced in partnership with Travelers Insurance Company Limited
Common pitfalls factsheet

The following Practice Compliance guidance note Produced in partnership with Travelers Insurance Company Limited provides comprehensive and up to date legal information covering:

  • Common pitfalls factsheet
  • Claims analysis—areas of work
  • Claims analysis—underlying causes
  • Mapping frequency against severity
  • Identifying the root cause of a claim
  • Underlying causes and severity—where the settlement money goes
  • The insurers' view

This factsheet is based on Travelers’ claims data over the six years to September 2014. It provides an overview of:

  1. the relative risks involved in the different areas of legal work undertaken by solicitors and other Solicitors Regulation Authority (SRA)-regulated entities

  2. the factors which cause claims, and

  3. some risk management lessons from our claims experience

In each of the six indemnity years in our review, we insured around 15% of solicitors’ firms, so the data reflects only a part of the total indemnity market. That said, we insure all sizes of firms in England and Wales and regard our claims’ experience as broadly representative of the profession’s as a whole.

Claims analysis—areas of work

Frequency

The first chart shows our claims experience broken down by the frequency, or number, of claims in various categories of work.

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Some commentary:

  1. Company/Commercial—produces the largest number of claims, almost one in five

  2. Commercial and Residential Property—generate almost equal numbers of claims. Together they account for over one quarter of the claims we have seen since 2008, the fallout from the financial crash

  3. Other Litigation—we have a number of separate categories of litigation, such as Employment, Landlord and Tenant and Personal Injury. Other Litigation cases tend to arise from failed Commercial Litigation

  4. Trust and Probate—accounts for 8% of claims

  5. Other Work—this covers a wide range of