Property Claims Set To Test Solicitor PI Cover
As the property market continues to struggle there are concerns that a number of solicitors will be on the end of claims against their professional indemnity (PI) cover. The more house repossessions in the UK, the more likelihood of a historic title defects arising, leading to claims by mortgage companies and home owners alike, determined to reduce any potential losses.
While the Council of Mortgage Lenders (CML) currently estimates that there will be 45,000 repossessions in the UK this year, there are fears that the final figure will actually exceed the 75,000 repossessions seen in the property crash of the late 1990s. As prices continue to fall many repossessed homes will be sold at a loss leaving the home owner and mortgage company out of pocket.
Even though solicitors who may have acted in the purchase of the property have nothing to do with the fall in value, they will be held responsible for any title defects and face being sued by past customers. There will be solicitors in the UK frantically checking their PI cover to see if they are protected, and the expectation is that PI premiums will also rise in line with claim numbers.
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