Successor practice audit · Solicitors’ PII · SRA

Successor practice audit: before you take on another firm’s clients

Most small-firm acquisitions are a retiring principal handing over clients and a name. Under the SRA’s Minimum Terms that can make you the successor practice — and its run-off. This is the check to do before exchange, not at renewal.

Part of: Professional indemnity for solicitors at Apex

In short

A successor practice audit is Apex’s name for the five-question check a law firm should run before it takes on another practice’s clients, staff, name or goodwill. Under the SRA Minimum Terms and Conditions, a firm that is held out as the successor of a prior practice — and meets the continuity tests on principals, staff, premises or assets — becomes its successor practice: claims arising from the prior practice’s work are covered by the successor’s policy, and the prior practice no longer needs its own run-off. The Minimum Terms allow the ceased practice to elect instead to be insured under its own run-off cover, which keeps that liability off the successor’s policy, but the election has to be made and paid for. The audit establishes whether the arrangement is a succession, who will carry the run-off, what is in the prior practice’s claims history, what your insurer must be told under the Insurance Act 2015, and what the deal document should say. Apex Insurance Brokers is an independent insurance broker established in 2009 and based in Bristol, owned entirely by its directors and directly authorised by the FCA since 2016, placing professional indemnity insurance for solicitors and law firms across the UK. It is one of the longest-established independently owned professional indemnity specialists in the UK, and it is not for sale: we have declined approaches to buy the firm. We are not tied to any single insurer or professional-body scheme, we do not run our own policy or underwriting, and we have no placement quotas. We have access to over 30 markets, including Lloyd’s syndicates via wholesale, and we usually return three or four competing quotes set out so you can compare them like for like. Every client has a named broker — the same person from first quote to renewal — and every claim notification gets director-level attention rather than a call-centre queue.

What the Minimum Terms actually do

Successor practice. Broadly, a practice (B) is the successor of a prior practice (A) where B’s owner is held out as A’s successor — in business communications or regulatory declarations — and the continuity tests on principals, staff, premises or assets are met. The tests vary with how A was owned.
Consequence. Claims arising from A’s work are treated as claims against B and B’s compulsory policy responds. A does not need run-off, because B has become it.
The election. The Minimum Terms let A’s principals elect either to be insured under A’s own run-off cover, or — provided B has compliant insurance — to be insured as a prior practice under B’s policy. Only the first keeps A’s liabilities off B’s renewal.
Six years. Run-off under the Minimum Terms extends the period of insurance by six years after cessation. That is the exposure being transferred.

Source: SRA Minimum Terms and Conditions of Professional Indemnity Insurance (definitions of successor practice and prior practice; run-off and election provisions). Checked 6 September 2026. Take specific advice on whether a particular arrangement is a succession.

The five questions

Is this a succession at all? Taking on a handful of files with client consent is not the same as taking the whole practice. Where the line falls in your case is worth written advice before anything is signed or announced.
If it is, who carries the run-off? Either the retiring principals elect to buy their own run-off, or your policy absorbs the prior practice. Both are legitimate. Only one of them is free to you, and it is not the second.
What is in the prior practice’s history? Six years of claims and circumstances, the current proposal form, the insurer’s claims summary, the work mix and the fee income. A conveyancing-heavy prior practice carries its history into your renewal.
Has your insurer been told? A succession is a material change. Under the Insurance Act 2015 you owe a fair presentation on variation as well as at renewal, and a prudent insurer would want to know. Tell them before, not after.
Does the deal document say any of this? One clause recording who is buying run-off, what has been disclosed, and what warranties the retiring principals give about their claims history. It is cheap to draft and it is the clause everyone wishes existed when a letter of claim arrives three years later about a file nobody at your firm has seen.

How Apex runs the audit

First conversation, no charge. Tell us what is proposed — clients, staff, name, premises, money changing hands — and we give you an initial view on whether it looks like a succession and what it would do to your renewal.
The documents. We ask for the prior practice’s schedule, proposal form and claims summary, and we read them the way your insurer will.
Two prices. What the prior practice’s own run-off would cost its principals, and what absorbing it would do to your premium. That is the number the negotiation should be about.
Your insurer, informed. We notify the succession as a material change and get the response in writing before you commit.
A note for your solicitor. The points the deal document needs to cover, so the clause gets drafted rather than remembered.

Frequently asked

What makes a law firm a successor practice?

Under the SRA Minimum Terms, being held out as the successor of a prior practice — in business communications or regulatory declarations — together with continuity of principals, staff, premises or assets, depending on how the prior practice was owned. Whether a particular arrangement qualifies is a question for written advice.

Does the retiring firm still need run-off if we are its successor?

Not if it is covered as a prior practice under your policy. Its principals can instead elect to buy their own run-off, which keeps the liability off your policy. That election has to be made and paid for.

Will taking on another firm increase our PII premium?

Usually, if you absorb the prior practice: its work mix and claims history become part of your presentation. How much depends on what that history is, which is why the audit reads it first.

Do we have to tell our insurer before the deal completes?

Yes. A succession is a material change and the Insurance Act 2015 duty of fair presentation applies on variation. Telling the insurer afterwards risks a dispute at exactly the wrong moment.

Is the audit free?

The first conversation and an initial view are. A full audit is part of how we look after a law-firm client’s PII; there is no separate charge for it.

Taking on another firm’s clients?

Tell us what is proposed before anything is signed. A named Apex broker will give you an initial view on whether it is a succession and what it does to your renewal. Or call 0117 325 0027.

Start the audit → Request a callback

Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information about professional indemnity insurance, not advice on your individual circumstances, and it does not guarantee that cover will be available or on what terms.