General

Survey based on fee bands as follows:

Response received from a broad cross section of the Band Turnover A broad cross section of law firms which enable valuable benchmarking on a range of issues

Response from:

Credible responses make the survey very valuable

All capital cities other than Canberra responded

Wide cross section of state issues covered

Risk Management

Overall, 60% of respondents have dedicated risk management positions.

You can view where this is most prevalent by fee band and benchmark your firm

What level of fee relief is provided if any for the risk management role?

How other firms approach the risk management task and how committed they are to sound risk management policies and practices

Number one Risk Concern: Where do major PI claims compare with Reputational Risk or Anti Money laundering by fee band?

You can view the major risk concerns of other firms and by fee band for relativity to your firm.

What are the key concerns over managing clients in a difficult economic climate?

Learn from others on key issues or satisfy  yourself that you have considered the most common concerns

What are the key operational risks of law firms? Are they common across the fee bands?

Disaster Recovery, Business Continuity Planning and others. Are your prepared and are there other operational risks you should consider?

Are you in the 47.5% of those surveyed that are well prepared to manage risks? If not, how do you intend to develop your risk identification and management processes?

The UK PI insurance market for lawyers is hardening as rates go up and conditions are less favourable to law firms. There are many risks not covered by insurance and for those that are the best prepared firms can sell their situation more successfully

Do you have risk policies and do you review incidents?

What do others do?

What do other firms spend on risk management per annum?

Benchmark your firm. It may assist your partners or Board in considering a reasonable spend on risk management

What other advisory/business services are provided by the surveyed law firms and for which they take out insurance protection?

You can see the approach of firms by fee band

Outside Australia, which are the most common territories in which law firms operate and do they take special risk management steps in view of the laws and risks in those territories?

If you provide advice outside Australia, even if on a “fly in fly out” basis you can view what other law firms are doing. This issue also has ramifications for the PI insurance contract

Insurance

Which is the most commonly used Compulsory insurance scheme and which brokers, advisers and Underwriters figure most prominently in XSPI arrangements?

You can compare your arrangements by fee band. You can determine if you are at common market practice. You may wish to review your arrangements.

Based on the fee bands we have benchmarked the total cover purchased for PI Insurance.

You can benchmark your firm by reviewing the results for your fee band. This will provide you with an independent view of the PI insurance buying decisions of comparable law firms

Why do law firms change broker or underwriter/insurer?

Review the service concerns and buying decisions of other law firms

Are presentations to XSPI Underwriters/Insurers common in Australia and Overseas? If so, at what level of fees is this undertaken? Should you be considering making presentations and if so how?

Determine if like firms make presentations. You can then discuss their potential value.

Visit www.legalriskthinkers.com.au for further information

What are the claims trends experienced by those surveyed? How do you compare?

You can assess if your claims experience is similar to others and determine if you need to take steps to improve or determine if you are receiving maximum value for your claims position from insurers

Do you purchase any/all of the following additional insurances perceived as relevant for the potential liabilities of law firms:

• Management Liability
• Directors & Officers Liability
• Employment Practices Liability

Consider the need for your firm to purchase these types of policies

Do any firms use their own insurance company (Captive) to assist in risk financing and if so in which fee band does this happen?

Self-insurance is an option mainly for large law firms. It is unlikely to be viable for firms paying less than A$1M. If you pay more than $1M have you assessed the potential benefits of a Captive or similar risk financing vehicle?