Frequently Asked Questions
Professional Indemnity Insurance Applications. Click on the questions below to view information.
Do I have to complete an insurance application?
Yes, all legal practitioners practising as principals of a law practice (unsupervised) in NSW are required to hold or be covered by Professional Indemnity Insurance (PII) pursuant to section 45 of the Legal Profession Uniform Law (NSW). Lawcover is the approved insurer for the legal profession in NSW.
All insurable solicitors practising in the ACT are required to hold Professional Indemnity Insurance (PII) under the terms of the Legal Profession Act 2006 (ACT), unless they have been granted an exemption by the ACT Law Society. Lawcover is an approved insurer for the legal profession in the ACT.
If your law practice does not have PII in place by 1 July each year, the Law Society in your state will not be able to issue you, or the solicitors who work at your law practice, with Practising Certificates for that year.
I am setting up a new law practice. How do I arrange insurance?
If you are establishing a new law practice in NSW, you must first contact the Law Society of NSW Registry on (02) 9926 0156 or firstname.lastname@example.org to register your information.
Once you have completed all the Registry’s requirements and your new law practice has been registered, the Registry will advise Lawcover of your new practice’s details, including its commencement date.
Lawcover will then send you an information pack, which contains full details of how to arrange your PII. We will also provide you with login details to our Online Services, where you can complete your law practice’s insurance application. If you are ready to do this now, please click here.
If you are establishing a new law practice in the ACT, you must first contact the ACT Law Society to register your information. You can then contact our Insurance Services team at email@example.com or 1800 650 748 in order to arrange for an information pack to be sent to you. This pack contains full details of how to arrange your PII. We will provide you with login details to our Online Services, where you can complete your law practice’s insurance application. If you are ready to do this now, please click here.
What are the benefits of using Online Services?
Online Services are designed to make your PII application a convenient, single-step process.
For new law practices, once you have registered your practice with the Law Society in your state and received your login details from us, you can log in to our Online Services at any time and complete your PII application. If you are ready to do this now, please click here.
For renewal applications, you no longer need to submit a paper Proposal Form in February in order to receive a quotation in April to meet the Practising Certificate deadline of 15 May each year.
Instead Online Services will be open for renewals in April each year and, subject to certain criteria, many practices will be able to receive their quotation online instantly. There will be some cases where referral to the Lawcover Insurance Services team is required and your insurance will be finalised following their review. We will advise you when Online Services are open for renewal each year.
You are able to download your tax invoice and your insurance policy as soon as your premium payment has cleared.
How do I best prepare for my application or renewal?
The online application form is similar to most online forms. If you have all the required information to hand, it will be a simple process. The following information is required before you commence the online process:
- Historical Gross Fee Income results
- Forecast Gross Fee Income for the coming year
- Non Lawcover claims history, if any
- Prior practice history, if applicable
- If applicable, your law practice’s AS LAW 9000 – Legal Best Practice or ISO 9001 – Quality Management Systems Certificate (for a potential discount to your premium).
What if I lose my login details?
If you have misplaced your login details you can click “Forgotten your Password” on the login page on Lawcover’s website and you will be emailed a new temporary password. For your security, your temporary password will only be valid for 72 hours, after which it will expire. You are only able to use your temporary password once, and will be prompted to change it when you first log in. To do this now, please click here.
If you need any further assistance you can contact the Lawcover Insurance Services team at firstname.lastname@example.org.
Do I have to pay online if I use Online Services?
No, other payment methods are available. However online payments are faster, meaning that your tax invoice is available sooner. We are also able to notify the Law Society of NSW or the ACT Law Society that your insurance arrangements are in place earlier. This means that the Practising Certificates for you, and any solicitors who work at your law practice, can be released earlier.
Can I still request a paper proposal and quotation form be sent to me?
Yes, paper proposal forms and quotation forms will be issued on request. The due date for returning a paper quotation form is the Practising Certificate due date of 15 May each year.
When should I complete my insurance application?
For new law practices, the due date for completing your application will be printed on the letter we send you with our information pack, which provides details of how to log in to Online Services.
For renewing law practices, we will write to advise you when Online Services are open for renewal each year. This is usually in April and you will be able to log in and complete your application then.
If you request a paper quotation form, this will be due back by 15 May each year.
How will the information I provide be used to calculate my law practice’s premium?
In most cases, your law practice’s premium is calculated using your Gross Fee Income (GFI) for the previous financial year. Your premium is based on the preceding year’s GFI because any claims made against you are likely to arise from legal services you have undertaken in the past year. We may make an exception, at our discretion, if the GFI you estimate for the forthcoming year has increased or decreased by more than 35%. For example, if you take on a new client or instructions which will result in higher earnings. Alternatively, you may be unable to work for a period and your earnings decrease. In these cases, we may calculate your premium using an average of the GFI you declare for each year.
All law practices with the same excess option selected and the same GFI pay the same base premium (prior to adjustments for interstate offices, claims loadings or discounts, risk management discounts or criminal law specialisation discounts), irrespective of the number of principals, solicitors or other staff you employ.
What should I include in my Gross Fee Income declaration?
Your Gross Fee Income (GFI) consists of the total fees charged by the law practice or by you (if you are a sole practitioner or independent contractor) for legal work and for services generated internally, such as photocopying, postage and couriers. While these items may be described on the client’s bill as disbursements, they are included in your GFI as they are charged to clients and they do not represent an expense paid by the law practice to a third party on behalf of the client.
- All fees received or receivable by the law practice or you which have been earned from the provision of legal services by principals or legal practitioner directors and employees* of the law practice or by you and
- Internal costs and disbursements charged to clients (for example, photocopying, postage and couriers).
- All payments received by the law practice or you for third party disbursements** or fees for services rendered by independent contractors*** to the law practice (whether or not those persons are providing legal or other services to the law practice)
- All payments received by the law practice or you which are earned from an area of practice where you have a statutory immunity from suit under legislation in force in Australia
- All fees that remain unpaid by your client for more than 18 months
- Any GST or other taxes that the law practice collects and
- All fees generated by an interstate or overseas office that arranges its primary PII through an insurance provider other than Lawcover.
*Employees include legally qualified personnel, paralegals, articled clerks, special counsel, secondees, locums, office and clerical staff employed by the law practice or a service entity of the law practice. However, some consultants may be considered to be independent contractors – see *** below.
**Third party disbursements means amounts paid or payable by you to a third party for goods and services obtained for the benefit of a client, such as barristers’ fees, medical report fees, experts’ fees, court filing fees, mediators’ fees, search fees and investigators’ fees. They do not include amounts paid or payable for goods or services obtained for the benefit of the law practice, such as referral fees.
*** An independent contractor is a person who is not employed by the law practice or you, but who is engaged to provide certain services to you or your clients, and can include barristers, surveyors, auditors, accountants and investigators. Independent contractors are not covered by your law practice’s PII policy and are responsible for making their own insurance arrangements. For more information on consultants and PII, please click here.
If you, or the law practice, do not generate any income from legal practice, you should declare a ‘nil’ fee income.
If my Gross Fee Income reduces, will you process a refund?
You may request a premium review if your gross fee income (GFI) has increased or decreased by more than 35% from that which you originally estimated. A statutory declaration stating the reasons for any decrease in GFI is required. However, you do not need to complete a statutory declaration if you declare an increase in your GFI. To request a statutory declaration, or to advise us of an increase in your GFI, please contact our Insurance Services team at email@example.com. We will then contact you to advise you of any alteration to your PII premium as a result of the change in your declared GFI.
I am not sure what I might earn next year. What should I put in my application?
Put in your best estimate. A guide might be to examine what you have earned in the last year, or perhaps in the past six months and then double it for projection purposes.
Do I have to complete the claims history question? Don’t you already have this?
You must answer all of the questions regarding your law practice’s claims history. If your law practice has at any time been insured at a primary level (compulsorily) in another State, Lawcover will not have details of your claims experience during that period. Further, there may be matters that you have not notified to us that should be notified.
If I buy a law practice, will I inherit its claims history? What is a Prior Practice?
If you have purchased a law practice or acquired its business, you may become its successor practice, as defined in the Lawcover PII policy. The GFI of the prior practice (the law practice you have purchased or acquired) should be included in your GFI.
Having a prior practice may affect your law practice’s premium, especially if it has had claims. When considering whether to purchase or acquire a law practice, it is advisable to enquire into the professional performance of that practice and whether there have been any claims made against it. You can request that the law practice provide you with its claims history, which it can obtain from Lawcover (or other state or territory PII provider).
For a more detailed explanation and guide to issues for consideration when purchasing or acquiring a law practice, please click here.
Will notifying a matter or circumstance that could give rise to a claim against my law practice affect my claims history?
You should notify Lawcover if you or any of your principals or employees are aware, or reasonably should have been aware of:
- A matter, fact or circumstance that might give rise to a claim against you; or
- A claim made against you or your principals or employees.
Your premium will not attract a claims loading as a result of notifying a circumstance that might give rise to a claim against your law practice, but notifying an actual claim made against your law practice may result in a claims loading being applied to your future premium.
You can contact our claims team on (02) 9264 8855 to discuss any matter with no obligation. We will not consider an enquiry to be a notification until it is advised to us in writing.
To access a Claim or Circumstance Notification Form, please click here.
If I have a favourable outcome in a claim will I receive a refund on any claims loading?
Lawcover does not refund claims loadings if there is ultimately a favourable outcome in your claim. Similarly, we do not retrospectively apply a claims loading if there is ultimately an unfavourable outcome in your claim. There may however, be a reduction in the premium you pay in the following years if your claims history has improved.
Why am I not entitled to a no claims discount?
When Lawcover surveyed the profession in relation to a no claims discount eligibility option, the prevailing view was that principals of new law practices should have to earn their no claim discount over five years. Therefore, you may not be eligible for a no claim discount if you have not been a principal of a law practice (or practices) with good claims history continuously for at least the last five full financial years.
I am changing to an incorporated legal practice. Will my old practice still be covered under my new insurance policy?
If you are establishing an Incorporated Legal Practice (ILP), you must first contact the Law Society of NSW Registry on (02) 9926 0156 or firstname.lastname@example.org to register your information. Once it has received your application, the Registry will forward the details of any changes made to your old law practice, or the details of your new law practice, to Lawcover. We will then contact you to advise you if anything further is required.
In many cases, the ILP is essentially the same law practice for our premium rating purposes. Provided the premium has been paid on behalf of the old practice, a policy can usually be issued to the new ILP, providing cover for legal services provided by both the ILP and the former (prior) practice.
However, if the GFI estimated by the ILP changes substantially, a premium reassessment may be necessary.
If I employ a solicitor or other staff or take on a principal will it affect my premium?
The number of principals, solicitors or other staff at your law practice is not used to calculate your PII premium. It is the gross fee income (GFI) of the practice that primarily determines your premium. So your premium would only increase in the following year if your new solicitor or other staff generates increased GFI for and on behalf of your law practice.
However, you should be aware that if you take on a principal who has an existing or prior law practice, you may become the successor practice to that law practice. The GFI of the prior practice should then be included in your GFI.
Having a prior practice may affect your law practice’s premium, especially if it has had claims. When considering whether to take on a new principal who has an existing or prior practice, it is advisable to enquire into the professional performance of that practice and especially, its claims history. You can request that the law practice provide you with their claims history which they can obtain from Lawcover (or other state or territory PII provider).
For a more detailed explanation and guide to issues for consideration when purchasing or acquiring a law practice, please click here.
If I employ a consultant, are they covered under my Lawcover PII policy?
The title ‘consultant’ is used in many different contexts by lawyers and does not necessarily refer to an independent contractor who is providing consultancy services to the law practice. Under the Lawcover PII policy, a consultant who is determined by us to be an employee of a law practice is covered, whereas an independent contractor is not.
Typically, an independent contractor will be an individual who is not supervised, whose contact with clients is not controlled and whose work is not authorised by the principals or management of the law practice.
Lawcover provides a simple checklist on our website to help us determine whether or not a consultant will be treated as an employee or an independent contractor for the purposes of policy coverage. Our determination allows us to confirm whether that consultant is covered under the law practice’s policy, or whether it is more appropriate for the consultant to make their own insurance arrangements. This in turn will dictate whether the fee income that the consultant generates should be declared to us by the law practice. For more information on consultants and PII, and to download the consultant checklist, please click here.
What if my law practice requires more than $2 million PII cover?
If your law practice requires PII cover over the primary limit of $2 million, Lawcover can offer a range of additional or Top Up PII limits up to a total of $20 million cover under your policy. Please see the Top Up section of your online application or section 2 of your quotation form for optional Top Up Insurance quotations.
If your law practice requires quotes for limits other than those supplied on your online application or quotation form, please contact our Insurance Services team at email@example.com.
For more information on optional Top Up insurance, or to download a Top Up brochure, please click here.
How does run off cover work? Is my law practice eligible?
When a law practice ceases and is not succeeded by another law practice, that practice will receive the benefit of ongoing PII cover under one of the Run Off PII policies issued by Lawcover to the Law Society of NSW and the ACT Law Society.
The Run Off PII policies are renewed by the Law Society of NSW and the ACT Law Society each year, and each policy provides cover for law practices that:
- Have ceased to practice prior to or during the period of insurance
- Were insured by Lawcover at the time they ceased to practice and
- Have not become a prior practice of another law practice
There is no ongoing or additional premium payable by the ceased practice. However, should a claim be made against the ceased practice, an excess will apply. The current excess is $5,000 each claim, or the excess that applied to the PII policy in force at the time the law practice ceased to provide legal services, whichever is the lower. The excess is subject to a maximum of $10,000 for each law practice in each year, or twice the excess that applied to the PII policy in force at the time the law practice ceased to provide legal services, whichever is the lower.
Lawcover can also arrange Top Up Run Off cover (subject to certain criteria) for law practices that cease to practice and which had purchased optional Top Up insurance from Lawcover for at least three (3) continuous years prior to ceasing.
To find out more about Top Up Run Off cover and how it may apply to you, please contact our Insurance Services team at firstname.lastname@example.org.
Can I fund my insurance premiums elsewhere?
Yes, while Lawcover has facilities available with three premium funders, you are not compelled to arrange funding with them. You may finance and repay your PII premium by instalment using an alternative facility that you arrange.
Please ensure that your premium funder settles your premium payment to Lawcover by the due date. This will be 15 May each year, for law practices renewing their PII policy. For new law practices, it will be the date printed on the letter we send you with our information pack.
Primary Professional Indemnity Insurance
About Professional Indemnity InsuranceInformation for New Law PracticesHow We Calculate Your PremiumPrior Practices – Why They Are Relevant To Your Professional Indemnity InsuranceLaw Practice Dissolutions – How They Impact On PremiumsDue Diligence Guide for PrincipalsConsultant – Employee Or Independent Contractor?Frequently Asked QuestionsInsurance Policies, Forms & Brochures