The legal sector faces constant uncertainties, but one challenge remains unavoidable—covering the cost of Professional Indemnity (PI) Insurance.
Many firms intend to set aside funds for their PI premiums, yet in reality, most rely on financing. The problem? Premium details are often released late, leaving firms scrambling to secure funding at the last minute—risking delays, higher costs, or even rejection.
This situation causes needles stress year after year. Arranging finance early is not just good practice—it’s a game-changer. Here’s why:
1. Eliminate Last-Minute Chaos
Each year, law firms leave financing to the wire, causing unnecessary stress and pressure. By securing funding early, you take back control, ensuring a smooth, hassle-free process.
2. Strengthen Financial Stability
Early financing locks in certainty. If an initial funding request is declined, you have time to secure alternatives—avoiding a last-minute scramble for costly emergency funding. If financial performance has dipped, funders may not cover the full amount, leaving you to rely on cash reserves or partner contributions.
Early financing enhances financial predictability—ensuring your firm remains financially stable and well-prepared.
3. Get Pre-Approved and Stay Ahead
Even if the final premium is unknown, you can prepare now. Use last year’s figure, add a reasonable increase (5-10%), and get a pre-approved funding line. This gives you peace of mind—knowing that when the renewal premium is advised, finance is already in place.
Act Now: Get Ahead of the Deadline
For firms planning to finance their PI insurance, time is of the essence. To secure the best options, provide finance brokers or banks with:
✅Latest finalised accounts
✅Up-to-date management accounts
✅Three to six months of bank statements
If financial performance has dipped, act proactively—prepare an explanation and improvement plan. A finance broker can help structure this, ensuring the best possible outcome.
Brokers have access to a range of funders and can match your firm with the right solution. Choosing a reliable broker is an investment in your firm’s financial health. Often the service will be much more responsive than a traditional high street bank which allows you to build a trusted relationship.
Don’t Wait Until It’s Too Late
Every year, law firms face the same dilemma. You don’t have to. Take control now—secure funding early, reduce stress, and ensure financial stability.
✅Remember: If you don’t know your premium yet, use last year’s figure and add a small percentage. This simple step creates a pre-approved funding line, giving you the flexibility you need.
About the Author
Paul McCluskey is the Managing Director of Gemstone Legal, specialising in law firm finance and risk management. Approved by the Law Society of England and Wales as a Lexcel assessor and consultant, Paul understands the unique financial challenges law firms face.
Unlike other finance brokers, Paul not only secures funding but also helps firms identify ways to generate additional income, ensuring a smoother, more sustainable financial future.
Don’t leave it too late—secure your PI insurance financing now.
If you want to explore your options, book a time to talk that suits you.
Comments