Introduction by Laurence K Shields Chairman 

Dear Colleague,

I am delighted to announce the launch of the SMDF LQ Basic Risk Management Standard, designed for us by Anne Neary Consultants.  I have posted details of the SMDF LQ Basic below, and if you have any questions, please do not hesitate to contact our manager, Margaret Weber.

I know how anxious you are about the rising cost of professional indemnity. I want to do everything in my power to help and support colleagues.  One way of doing this is to show you how to put the appropriate risk management procedures in place through a transparent Standard.  The SMDF LQ Basic Standard comes with detailed instructions, action plans and templates.  It is designed as a framework for you to customise your own risk strategies and procedures and help you implement new procedures where necessary.

The insurance industry as a whole requires solicitors to implement comprehensive risk management procedures. The individual elements of the SMDF LQ Basic reflect these requirements which will form the basis for our renewal form this year.

The SMDF is committed to stabilising the PI market and bringing the cost of PI down.  Introducing a risk management standard and reducing claims is the best way of achieving this aim.  While this may not happen this year, risk management will reduce claims and bring costs down over time.

So, I strongly recommend that you apply for the SMDF LQ Basic this year.  The earlier you apply the better, as you will need time to prepare.  All your preparation work will also assist you in completing a good PI application at renewal.

Kindest regards

Laurence K Shields
Chairman SMDF

What is the SMDF LQ Basic Standard

The SMDF LQ Basic is a set of 4 minimum standards designed to minimise risk in the operation of a law firm and to enable firms to practice in a safe and profitable manner.
The four minimum Standards of the SMDF LQ Basic are:

• Standard One – Critical Registers
• Standard Two – Limiting Liability
• Standard Three – File Reviews and Supervision
• Standard Four – Risk Management Procedures

The SMDF LQ Basic Standard is designed to

• provide a common risk management standard for the legal profession
• provide a framework for legal firms to implement their own policies and procedures to achieve their aims
• minimise risk in the provision of legal services
• improve quality in the provision of legal services

The SMDF LQ Basic Standard is presented in a straightforward and simple manner.  It is transparent.   It enables solicitors to optimise their position at renewal time.

Advantages of the SMDF LQ Basic

• assists solicitors reduce claims and ultimately reduce the cost of PI
• sets a common basic risk management standard for the legal profession
• helps solicitors to run well managed practices
• enables solicitors demonstrate that they are suitable risks at renewal time

How can the SMDF LQ Basic help me assess and reduce my risk?

The SMDF LQ Basic sets out the essential risk management procedures required of solicitors for professional indemnity. In order to assess the level of risk in your firm, you should assemble all of the policies and procedures you have in place in your firm and compare them to the required elements in the standard as set out in the self-assessment questionnaire.  You will see at a glance how many procedures and policies you have and how many you still need.

Every element of the standard reflects either a risk or a claim made in the past.  In the majority of cases, claims are foreseeable events. By taking appropriate action, these foreseeable claims can be eliminated, thus reducing risk and bringing the cost of PI down.

Risk Management Self Assessment Questionnaire

We have a Self Assessment Questionnaire, which sets out all of the policies, procedures, registers and other documentation required by the SMDF LQ Basic.  You may request a copy of the questionnaire by emailing Margaret Weber at margaret.weber@smdf.ie. 

The Next Step – Getting Started

The Self Assessment Questionnaire will help you to identify what procedures you have and any essential risk management procedures you need to implement. After you apply for accreditation to the standard, you will receive a very detailed guide and action plan. If you follow the guide and implement the required procedures and policies, your firm can achieve a good score which will help you demonstrate to professional indemnifiers that your firm is a good risk. 

Remember that preparing for the standard takes time, even if your firm is well organised, so apply for the SMDF LQ Basic as early in the year as possible and begin preparing for accreditation.

The SMDF LQ Basic Guide

After we receive your application, we will send you the Guide to the SMDF LQ Basic so you can get going.  The Guide contains a detailed explanation of what is required to achieve the standard, together with action plans and references to background material.  Many of the processes and procedures required by the SMDF LQ Basic are set out in The Solicitors Toolkit, Anne Neary’s practice management guide for solicitors.  We hope that between the Guide and The Solicitor’s Toolkit (2010 ed.) you have enough information to prepare the documentation in-house.

The Certificate of Registration

As soon as you apply you will receive a Certificate of Registration.  If you have not achieved the Standard by the renewal date, you may include Certificate of Registration with your PI Application as evidence of your commitment to risk management.

The Audit

Your firm will be assessed in an audit at your offices which will take the form of a meeting between the principal/equity partners of your firm and an auditor.  During the meeting, your audit folder containing your written policies and procedures will be reviewed.  Each document will be scored against the elements set out in the Guide.  A high score will demonstrate that you have a broad range of systems and cross checks in place which will minimise your risk. 

The Pre-Audit

If you need some help with the drafting or implementation of the SMDF LQ Basic you may request a Pre-Audit.

The Certificate of Accreditation

On completion of the audit, you will be issued with a certificate confirming that your firm is accredited.  The duration of the certification period is one year.