Background Part 1 – Regulatory Framework Requirements of both category 1 and category 2 regulators Section 17 – Professional indemnity insurance
62.This section requires each category 1 and category 2 regulator to have rules concerning indemnity for the legal services providers it regulates against any kind of professional liability. A failure to comply with them may be treated as professional misconduct or unsatisfactory professional conduct. The Lord President must agree to the making of them and any amendments. While regulators are afforded some discretion in relation to how this is achieved, it ensures that insurance is in place to cover situations where the actions of a legal services provider results in a client suffering loss or damage.