17 November 2017

Insurance

What are the insurance requirements for a BSB regulated entity?

All BSB regulated entities must have appropriate insurance arrangements in place at all times. If not, your entity is in breach of the mandatory conditions for authorisation as specified in the BSB Handbook - see rule S83.4 and related guidance. 

The minimum insurance cover that BSB authorised bodies ("entities") are required to have is outlined in the Bar Standards Board: Minimum Terms of Entity Cover which is published on our website.

These terms have been revised to include BSB licensed bodies ("ABS").  However the revised terms will not come into force until we begin approving licensed bodies later in 2016.  We have published them on our website to allow potential applicants to consider their insurance arrangements. Please follow this link to see them.  

It is very important to bear in mind that, depending on the nature of the work your entity will undertake, your insurance requirements may be greater than the minimum terms.  We recommend you speak with your insurer about the level of cover appropriate for your specific circumstances. 

There is a strictly enforced 21-day grace period from the date on which the BSB confirms your authorisation for you to provide us with evidence that appropriate insurance is in place.  This is to allow newly authorised entities time to arrange appropriate insurance cover in recognition of the fact that insurance providers will require confirmation of authorisation before providing insurance cover. An entity will not be able to practise until the insurance is in place.

Failure to provide us with this evidence will invalidate your authorisation and your entity will therefore not be authorised to practise.  You will also be in breach of the BSB Handbook if you provide legal services during that 21 day period without insurance.

Please be aware that if you have professional indemnity insurance in place covering your practice as a self-employed barrister, you can continue to practise in this capacity whilst you are waiting for entity insurance cover.

As it may take time to arrange insurance cover, we strongly urge prospective entities to apply simultaneously to an insurer and to us for authorisation.  If you have any questions, please contact us on 0207 092 6801 or entityregulation@barstandardsboard.org.uk.

It is possible to transfer regulation of an existing entity from another approved regulator to the BSB.  However, you may need to check if your new insurance policy will cover you for actual or potential claims against your previous practice.  In some cases your previous regulator may require you to maintain "run-off" insurance for a period of time after switching to the BSB.  The SRA currently has an open consultation seeing views on what happens when entities switch regulators and how insurance coverage is managed through the changeover.  Please follow this link to see it.

The BSB will continue to monitor how other approved regulators are managing insurance cover when existing authorised persons or entities transfer regulation.