Howden: Acting as a professional deputy – is it covered under your PII?
On 5 February 2025, the Office of the Public Guardian (OPG) sent an e-mail to all professional deputies on its books, stating:
“Dear Professional Deputy
We are writing to let you know about a change in our policy position relating to Professional Indemnity Insurance (PII).
It is now the Public Guardian’s position that all professional deputies should now have PII in place. This position aligns with section 1e of our professional deputy standards.
If you do not currently have PII, please contact the Professional Deputy Team via opg.pro@publicguardian.gov.uk.
Kind regards
The Office of the Public Guardian”
This e-mail led to a large number of queries from clients as to whether the work they undertook as professional deputies was covered under their solicitors’ PII policy. Unfortunately, this was not the only consequence of this e-mail.
We were subsequently made aware of instances involving two of our clients who had made applications to the Court of Protection to be appointed as professional deputies in property and affairs for their clients. In each case, the district judge in question who dealt with the applications made an order requiring the solicitors to file witness statements confirming that they held adequate PII and that their insurer had confirmed in writing that their work as professional deputies would be covered by their PII policy and also confirming the limit of indemnity under the policy and whether this was inclusive of costs or not.
In each case, this led to several days of toing and froing with the insurer in question, trying to agree an acceptable form of wording which the insurer was prepared to sign which would satisfy the district judge. We and the clients spent a large amount of time dealing with this, instead of valuable fee earning time, as this could not be charged to the clients in question; it being an internal matter for the firms.
It was apparent from the orders made by the district judges that they did not appreciate the nature of solicitors’ PII. By way of example, it is nigh on impossible for an insurer to confirm that any work undertaken by an insured firm as a professional deputy would definitely be covered under a PII policy, as you simply do not know how a claim is going to be presented unless and until it is actually made, and a PII policy contains a number of exclusions for cover. Also, both solicitors clearly already held PII, because it is compulsory for solicitors working in SRA-regulated law firms.
Is the work covered under a PII policy?
It is our view that acting as a professional deputy is covered under a solicitors’ PII policy (subject to policy terms and conditions) provided that such work is being undertaken in the name of the firm in the usual course of business. The relevant part of the MTCs is the definition of private legal practice:
“private legal practice
Means…:
i. the provision of services in private practice as a solicitor or REL in an authorised body including, without limitation:
a. providing such services in England, Wales or anywhere in the world in a recognised sole practice, a recognised body or a licensed body (in respect of an activity regulated by the SRA in accordance with the terms of the body's licence);
b. the provision of such services as a secondee of the insured firm;
c. any insured acting as a personal representative, trustee, attorney, notary, insolvency practitioner or in any other role in conjunction with a practice;
d. the provision of such services by any employee; and
e. the provision of such services pro bono;…”
Whilst the role of professional deputy is not specifically mentioned in the definition of private legal practice, professional deputies are essentially acting as personal representatives, which is included in clause (c) above, although in any event that clause has the catch-all words “…or in any other role in conjunction with a practice…” which in our view would cover this work anyway.
We have also had written confirmation from the two insurers mentioned above that this work is covered under a PII policy. However, in view of the issues caused by the orders made by the district judges, we are currently liaising with the SRA with the view potentially to amend the definition of private legal practice in the MTCs to add the words “professional deputy” to clause (c) above.
OPG Guidance
The change in position by the OPG regarding PII for professional deputies appears to have occurred when it published its most recent guidance on 13 February 2023 (so why it took two years to send out the above e-mail is unclear).
Section 1e of the guidance, referred to in the e-mail, states the following:
“1e Ensuring appropriate security is in place
Applicable to: Property and financial affairs
You must pay annual premiums to the bond provider when requested to do so.
If there is a significant increase or decrease in the value of P’s estate, you must consider whether the level of security is still appropriate. For example, if P receives a payment from a clinical negligence claim, you may need to apply to the court to increase the value of the bond.
All professional deputies must take out professional indemnity insurance (PII). Regulated professionals should adhere to the guidance on PII provided by their respective regulatory bodies.
When taking out PII you must consider the potential aggregated risk to P in line with the factors described by Judge Marshall in the case of Baker v H [2009] EWHC B31 (Fam).”
It appears from this guidance that the requirement to hold PII only applies in respect of appointments relating to property and financial affairs, but not health and welfare appointments. It also reminds professional deputies that they should adhere to any guidance from their respective regulatory body regarding PII, as well as the potential aggregated risk to the protected party as set out in the case of Baker v H [2009] EWHC B31 (Fam).
Rule 3.1 of the SRA Indemnity Insurance Rules imposes a requirement on regulated firms to take out and maintain “adequate and appropriate” PII. The case of Baker v H considered the level of security bond which was required for a court-appointed deputy. The deputy, Mr Baker, challenged the level of the bond, claiming that the annual premium for it was a burden on the estate, and the court agreed on the basis that his firm held sufficient PII to cover any likely claim, so reduced the amount of the bond from £750K to £175K, which led to a much lower premium for the bond.
Howden commentary
In light of the OPG’s updated guidance and law firm’s regulatory obligations regarding PII, firms should assess the value of the estate for any appointments they are undertaking as professional deputies and consider whether the level of their PII cover is sufficient to cover any potential claims which may arise.
For further information on issues to consider regarding how much PII your firm needs, we have written an article on this topic, which you can find here.
https://www.howdengroup.com/uk-en/how-much-PII-law-firm-need
