Insurers should be vigilant in cases of sham partnerships
In the UK, lenders’ requirements usually dictate law firms should consist of two or more partners to qualify for a place on conveyancing panels.
This (usually express) requirement acts as a fraud-prevention tactic and ensures there is professional indemnity (PI) insurance cover in place, even if one partner of the firm acts dishonestly.
However, the not uncommon occurrence of “sham partnerships” raises some interesting coverage questions in relation to such PI cover.
To view a full PDF of this article, please click here.