LONDON, 27 July 2005 – The area of residential conveyancing has so far given rise to the highest number of negligence claims amongst 2-10 partner law firms in 2005 according to Aon Limited, the UK arm of one of the world’s largest insurance broking and risk consulting firms.  Almost half (43%) of all claim notifications among 2-10 partner firms this year have been related to conveyancing, with approximately a quarter of these (25%) arising from residential conveyancing and almost a fifth (18%) linked to commercial conveyancing cases. 

Aon’s research found that most residential conveyancing negligence claims, by both number and value, stem from mistakes made in carrying out procedural issues related to the work - particularly failure to undertake sufficient property searches - or failure to correctly advise the client on points of law.

Failure to recognise recent (2004) amendments made to the Landlord & Tenancy Act (1954), which specifically affect the renewal of business tenancies, are a major cause of commercial conveyancing claims. 

In addition to conveyancing, Aon’s 2005 research highlights that 16% of negligence claims among 2-10 partner firms relate to Trust and Probate practice; 14% to Personal Injury practice; and 11% to Litigious practice.

Martin Thomas, Managing Director of Aon’s Claims Solutions Division comments: “Based upon our experience, the majority of claims causes flow from three core areas: timing issues, drafting errors, or advice which is not properly thought out, misleading or simply factually and, or, in some cases, legally incorrect.”

This year many 2-10 partner firms will have to buy more professional indemnity cover than they did in previous years as the Law Society has increased the minimum indemnity limit from £1m to £2m.  However the more claims that an individual firm experiences, the less attractive they are to insurers, and the greater amount of premium they will need to pay for their cover.

Angus Cameron, Executive Director, Aon Professional Risks, added: “No firm wants to be paying over the odds for insurance cover and so it is in their best interest to reduce their claims frequency.  In order to protect themselves, firms need to assess their potential level of exposure and embed robust risk management systems.  For example, areas of focus might include time recording systems, supervision levels and knowledge bases.

“The ultimate risk management initiative is the implementation of Lexcel 2004, the Law Society’s industry standard, but not all practices are willing to dedicate the financial resources required to do this.  For this reason, Aon and insurer QBE have devised a gap analysis service that enables firms to better understand their strengths and weaknesses and the scope for improvement in their procedures.”

Notes to Editors:

About Aon

Aon Corporation (www.aon.com) is a leading provider of risk management services, insurance and reinsurance brokerage, human capital and management consulting, and specialty insurance underwriting. The company employs approximately 48,000 professionals in its 500 offices in more than 120 countries.  Backed by broad resources, industry knowledge and technical expertise, Aon professionals help a wide range of clients develop effective risk management and workforce productivity solutions.

This press release contains certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995.  These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from either historical or anticipated results, depending on a variety of factors.  Potential factors that could impact results include the general economic conditions in different countries around the world, fluctuations in global equity and fixed income markets, exchange rates, rating agency actions, resolution of pending regulatory investigations and related issues, including those related to compensation arrangements with underwriters, pension funding, ultimate paid claims may be different from actuarial estimates and actuarial estimates may change over time, changes in commercial property and casualty markets and commercial premium rates, the competitive environment, the actual costs of resolution of contingent liabilities and other loss contingencies, and the heightened level of potential errors and omissions liability arising from placements of complex policies and sophisticated reinsurance arrangements in an insurance market in which insurer reserves are under pressure.  Further information concerning the Company and its business, including factors that potentially could materially affect the Company’s financial results, is contained in the Company’s filings with the Securities and Exchange Commission.

Aon Limited is authorised and regulated by the Financial Services Authority in respect of insurance mediation activities only.

About QBE

QBE Insurance Group is one of the world's leading international insurers and reinsurers, headquartered in Sydney, Australia.  We operate out of 36 countries across the globe, with a presence in all key insurance markets and are lead underwriters within our chosen markets, setting rates and conditions.  In 2004, the company underwrote gross written premium totalling AUD $8,766 million (€ 5,062.4m) and held shareholders’ funds of A$4,420m (€2,552.6m).

The Group consists of three geographically focused operational divisions: European Operations, based in London, the Americas, managed from New York, and the Australian Pacific Asia Central European operation –managed from Sydney.

QBE in Europe
QBE European Operations is a leading specialist in London market and European commercial lines business, active in both the Lloyd’s market through the managing agent Limit and the company arena through QBE Insurance (Europe).

Recognition
Today QBE is internationally recognised as a highly successful general insurance and reinsurance group, a builder of shareholder wealth, and a developer of ‘can do’ people and an organisation that excels in the continuous delivery of new and proven quality products and services.

Ratings
Standard & Poor's insurer financial strength and counterparty credit rating for QBE's main insurance subsidiaries is A+ (Stable). Fitch Ratings insurer financial strength rating for QBE's main underwriting subsidiaries is A+, and the agency has also affirmed a long-term credit rating at A. Their outlook for all ratings is Stable.  A. M. Best assigned the financial strength rating of the QBE Group of companies A (Excellent).

For more information on QBE, please visit our website www.QBE.com

all figures correct as at year end 31 December 2004

Aon Limited is authorised and regulated by the Financial Services Authority in respect of insurance mediation activities only.