Black and minority ethnic lawyers face losing their livelihoods because of discriminatory increases for their compulsory insurance, a legal analyst has warned.
BME law firms are reportedly seeing their compulsory indemnity insurance rising to as much as 800% or in some cases even being refused, despite not having received any complaints or claims against them.
Debo Nwauzu of Black Lawyers Directory told OBV blog:
“This is truly shocking and very worrying. Without this cover, a lot of ethnic minority firms simply won’t be able to carry out their legitimate business.”
A recent study by the Law Society found that minority ethnic firms were being treated differently by insurance companies, with 16% not offered cover by their previous insurer, compared with 6% in the rest of the profession.
Minority ethnic lawyers are more likely to practice in publicly funded areas such as criminal law, immigration, and family law, and are more likely to have to work within smaller profit margins. Large insurance increases could put many at risk of closure.
The Guardian’s Afua Hirsch highlighted the disparities.
“This year my insurance jumped from £6,000 to £24,000,” said Dele Ogun, a partner at Akin & Law LLP. “I have never seen anything like this before. I cannot begin to explain why a firm like ours, which has built up experience over 13 years, with not a single claim, has had its premiums hiked like this.
“Insurers say they are having to claw back the losses they have made on collapsing conveyancing practices, but that does not even begin to explain the disparity between ethnic minority firms and the rest of the profession.”
The Law Society has promised to examine the issue and take action to protect BME law firms.
By Dominic Bascombe