Insurance

The Insurance Arrangements are governed by the Legal Profession Act 2008, the Legal Profession Regulations 2009 and the Master Policy.

The Law Society is required to publish details of the Insurance Arrangements to Law Practices and Practitioners (Regulation 84(3)). This is specified in the Annual Information Booklet which is released prior to the commencement of the new insurance year.

Neither the Law Society nor Law Mutual WA is regulated by the Australian Prudential Regulation Authority (APRA). The Law Society has been granted an exemption on the basis that it is not an insurer – it only arranges insurance as required under the Legal Profession Act 2008.

The Law Society arranges insurance for Law Practices. Law Practices are issued with a Certificate on behalf of the Underwriters. This is evidenced by an insurance certificate provided to Law Practices. The terms and conditions of the Certificate are Schedule 1 to the Master Policy.

Ceased Law Practices and former practitioners previously insured through Law Mutual (WA) are also entitled to cover under the Master Policy in respect of professional indemnity claims arising from the practice of law during their previous periods of insurance through Law Mutual (WA).

The Certificates are issued in the Law Practice’s legal name and not their trading name (if it differs from the legal name). The certificates are not issued in the names of individual practitioners. Who is ‘insured’ is set out in the definition section of the Certificate of Insurance.

In summary, subject to the terms of the Master Policy, the Insurance Arrangements cover the Law Practice, its current and past partners/directors along with its current and past employees, for claims notified during the Insurance Year. The amount payable by Law Practices is comprised of 2 components:

  1. the Annual Contribution (Regulation 92), and
  2. the Administration Levy (Regulation 102).

For information about arranging or renewing your Insurance Arrangements please read the Annual Information Booklet.

New applications or request for changes during the insurance year

New Law Practice commencing during an insurance year

If during an insurance year you commence as a new law practice you will need insurance through Law Mutual (WA)’s professional indemnity insurance arrangements unless an exemption applies.

A law practice commencing practice during the Insurance Year, will have the annual contribution calculated from the date the practice applied for insurance. The insurance will only take effect once payment has been received. The full administration levy is also payable.  Depending on the class and category you are in, the relevant form will need to be need to be completed.

Additional practitioners – employed practitioners

  1. An insured law practice, and the practitioner, must advise Law Mutual (WA) as soon as possible when a practitioner is employed by submitting an Additional Practitioner Form 1A. Please allow at least 5 business days prior to the commencement date for processing.
  2. Where a practitioner was not previously at a law practice insured through Law Mutual (WA) and joins a law practice during the year, a pro rata annual contribution and a full administration levy is payable. A common example is a practitioner moving from a national exempt law practice to a WA law practice.
  3. The additional annual contribution and administration levy payable is set out below:
Number of hours working at the new Law Practice compared to previously Additional Contribution
Same or less None
More Pro rata (not exceeding maximum Contribution)

Part-time employed practitioners

If during an Insurance Year a law practice takes on a part time employed practitioner, the annual contribution is pro-rata’d based on a working week of at least 4 hours per week. The law practice is charged the full administration levy.

Changes to general employees

If a law practice has insurance in place with Law Mutual (WA) as at 1 March, no additional contribution is payable if they increase the number of general employees during the remaining Insurance Year.  If the numbers change after 1 March, no refund is given if the number of general employees reduces after this date.

If you are a new law practice commencing in an insurance year you will need to specify the number of general employees full time and part time

For further information on this area please refer to the General Employees section of our Annual information booklet.

Changes to practitioner status during the Insurance Year

If a practitioner changes status during the year, the Form 1A will need to be completed and returned to our office.

The following information may also apply:

Former role New role Further Contribution
Employed Practitioner 1 Principal (same practice) Pro rata Principal Contribution
Employed Practitioner 1 Principal (new practice) Pro rata Principal Contribution
Principal 2 Employed Practitioner (same practice) None
Principal 2 Principal (different practice) Pro rata Principal Contribution
Principal Employed Practitioner (different practice) Pro rata Contribution
  1. The unused portion of the existing Contribution is rebated against the additional Contribution payable
  2. No refund, pro rata credit or otherwise of the Contribution is payable by Law Mutual.

Practitioner ceases employment

When a practitioner ceases work at a law firm or other entity, the employer must notify Law Mutual (WA) of the cessation date as soon as possible.

Information in relation to Principals retiring during the insurance year along with general enquires about practitioners ceasing employment can be found in our Annual Information Booklet.

Restructure of a Legal Practice

If a legal practice undergoes a restructure or merger, Law Mutual (WA) must be notified in writing well in advance of the restructure/merger commencement date.

Special conditions apply with regard to restructures which may affect you. For further information please refer to our Annual Information Booklet – Restructure of Legal Practice.

Explanation of forms

Form A – Sole Practitioners and Partnerships – if you are classified as sole practitioner or partner for insurance purposes and you expect to be above the low fee earner threshold of $100,000 during an insurance year.

Form B – Low Fee Earners – if you are a sole practitioner or an incorporated legal practice and you estimate that you will earn less than $100,000 in gross legal fees for the entire insurance year. You will be entitled to concessional annual contribution rates based on your level of income. Conditions apply depending on who you can employ and discounts you are entitled to.

Form C – Incorporated Legal Practice – if your law practice is structured as an incorporated entity. An incorporated legal practice is a corporation (typically a company within the meaning of the Corporations Act) that provides legal services and that may provide other services in addition to legal services.

Form 1A – Additional Practitioner – when a practitioner joins or commences work at a firm during the insurance year other than renewal period.

Low Fee Earner – Statutory Declaration – An low fee earner must submit a statutory declaration to Law Mutual (WA) by 30 September following the end of the insurance year.

Notification of Exemption – if you are a practitioner who is entitled to an exemption pursuant to Regulation 97(1) (b), (c), (d), (e), (f) or (h).

Frequently Asked Questions

Do I have to complete an insurance application

Under the Legal Profession Act 2008 the Law Society of Western Australia is required to make professional indemnity insurance arrangements for practitioners and former practitioners.  Under the Legal Profession Regulations 2009, the Law Society is required to enter into professional indemnity insurance arrangements with one or more insurers for the provision of professional indemnity insurance for practitioners and former practitioners.

If your law practice does not have a professional indemnity insurance arrangements in place by 1 July each year, the Legal Practice Board will not be able to issue you, or the solicitors who work at your law practice, with a Practising Certificates for that year.

When should I complete my insurance application?

For renewing law practices, you will be advise by email that your renewal for the forthcoming year is due. This is usually in February and March, you will then need to submit a completed and signed renewal form applicable to your law practice.

If you are a new firm you will need to complete the respective application form and return to our office at least seven business days before the commencement date of insurance cover. For further information please refer to the New Law Practice commencing during an insurance year section above.

Paying your Premium

You can pay your premiums by:

Electronic Funds Transfer (EFT) – direct to Law Mutual (WA)’s bank account – this is most efficient method of payment as funds are usually cleared within two business days. Please quote the respective invoice number on each EFT payment to Law Mutual (WA). Payment details are provided on every invoice generated by Law Mutual (WA).

Cheques – please address to the Law Mutual Fund and mail to Law Mutual (WA). It can also be directly deposited into Law Mutual (WA)’s bank account over the counter at a branch of your banking institution. The funds are subject to clearance and this may take three to five business days.

Credit Card – To pay by credit card, the remittance advice section of each invoice will need to completed and sent back to Law Mutual (WA) for processing via an online credit card payment facility. Credit card payment instructions can be communicated to Law Mutual (WA) by phone, email or at its office. Funds are not immediately available to Law Mutual (WA) until remitted by the credit card merchant. This process can take up to two to three business days. Credit card payments also attract a processing fee of 1.5% of the invoice amount which covers merchant charges.

Premium Funding – Premium funding is a facility that improves cash flow by providing a cost effective monthly instalment option to pay your professional indemnity insurance premium. Applications will need to be submitted to the premium funding provider and may take some weeks depending on the funder’s assessment process. Information and quotations on funding can be sought from the following two more common providers.

To request a premium funding application, to fund payment for your professional indemnity insurance premium, please email your request to chelsea.furniss@marsh.com with your Law Mutual (WA) invoice.

Westpac Insurance Premium Finance

For general information on premium funding see Westpac Insurance Premium Finance. To request a competitive quote to fund payment of your professional indemnity insurance premium, please email your request to rindrisie@westpac.com.au along with your Law Mutual (WA) invoice.

Payment of Premiums

Law Mutual (WA) does not offer any instalment payment plans and cannot take cash payments. You will need to apply with a premium funding provider to fund your premium by instalments.

Regulations require law practices to pay their full annual contribution and administration levy by 15 May preceding the commencement of the Insurance Year (Regulations 83 and 88).

If this date falls on a weekend or public holiday, payment is due the next business day. Should payment not be made by 15 May of the relevant year, a 10% late lodgment fee will be imposed pursuant to Regulation 89(1) See Clause 6.8. The late lodgment fee will not apply provided any payment made by the 15 May is cleared within five (5) days thereafter.

We cannot receipt payments until the funds have cleared through our bank account. Once payments are fully receipted, a copy of the receipt will be emailed to the email address prescribed in the latest renewal application from the Law Practice.

The Legal Practice Board will be notified of compliance on the following business day after your payment is receipted.

Non Payment

Any law practice that does not pay its renewal invoice and late lodgment fees (if any) before 30 June for the next Insurance Year, will have its invoice withdrawn and cancelled effective as of 30 June and will have no insurance cover for the ensuing Insurance Year. Law Mutual (WA) may, at its absolute discretion, reinstate the invoice and accept a payment on or after 30 June.

In the unlikely situation where an existing law practice continues to practice into the next Insurance Year without having either applied for or paid for insurance then:

  1. until a Certificate is issued, the Law Practice will be practising in contravention of the Legal Profession Act 2008;
  2. The Law Practice, its Principals, Directors and its Employees will be uninsured, and
  3. The Law Practice may not be able to recover its professional fees.

Law Mutual (WA) is not obliged to offer cover for the following Insurance Year if the Law Practice has not paid any outstanding invoices by 15 March (Regulation 91).

How much is my premium and are discounts available?

Information can be found in our annual information booklet based upon your classification, criteria and circumstances. If you require further information regarding an insurance quote, you can contact Law Mutual (WA) on (08) 9481 3111 or email info@lawmutualwa.com.au

How do I submit a Notification of Exemption from Law Mutual (WA)'s professional indemnity insurance arrangements?

From the 1st of July 2016 the Law Society administers the submission of the Notification of Exemption Forms. An administration Levy of $75 (inclusive of GST) is chargeable to each practitioner to cover the costs of processing Notifications, as it is entitled to do so by Regulation 102 of the Regulations.

However, the charge will be waived for the following categories of practitioners:

  • Financial members of the Law Society of Western Australia
  • Employees of a Community Legal Centre, Legal Aid Commission and Aboriginal Legal Service (as defined in the Legal Profession Act 2008 and prescribed in Schedule 2 of the Regulations)
  • Those claiming exemption under 97(h)

Please complete and submit an online notification of exemption form.

New insurance application or a change to your firm or circumstances during the year

You will need to notify Law Mutual (WA) as soon as possible when there are changes to your firm or you need to complete a new application form.  For more information please visit the New Applications or request for changes during an insurance year section above.

Please note: the Certificate of Insurance cannot be cancelled and is not transferrable.

If Law Mutual (WA) was notified before 30 June in that respective insurance year of a partner/director or an employed practitioner leaving a law practice, a refund may be provided if a practice certificate has not been issued for forthcoming year.  No refunds are payable by Law Mutual (WA) where notification is received after 30 June of the respective insurance year.

No refunds are paid for employed practitioners, partners or directors who leave the firm after 30 June of the respective insurance year. For more information on refunds, please refer to our annual Information booklet.

What happens if I fail to renew my insurance by the 15 May deadline?

Regulation 89 of the Legal Profession Regulations 2009 imposes a late lodgement penalty of 10%, where law practices have not paid the insurance contribution by the annual 15 May deadline. The Law Society can waive payment of the late lodgement fee in whole or part at its discretion.  It has developed a policy to ensure fairness and consistency in the exercise of this discretion.

Law Mutual (WA) is not obliged to backdate cover; this remains a discretion to be exercised by us in appropriate circumstances.

Do consultants, mediators, migration agents and settlement agents require insurance?

The Law Mutual (WA) policy only covers legal work that you undertaking in those role. Any non-legal work is not covered.  You will need to determine if the work undertaking in these roles is legal work. The definition of Legal work can be found in the Legal Profession Act 2008.

The title ‘consultant’ is used in many different contexts by lawyers and does not necessarily refer to an independent contractor who is providing consultancy services to the law practice. Under the Law Mutual (WA) professional indemnity insurance arrangements, a consultant who is determined by us to be an employee of a law practice is covered, whereas an independent contractor is not.

Typically, an independent contractor will be an individual who is not supervised, whose contact with clients is not controlled and whose work is not authorised by the principals or management of the law practice.

For more information on consultants and professional indemnity insurance arrangements, please refer to our annual Information booklet.

When will I receive my Practice Certificate?

The Legal Practice Board will be notified electronically on the following business day after your payment has been cleared and receipted.

Law Mutual (WA) has no responsibility over the issuing of Practising Certificates. You will need to contact the Legal Practice Board directly in respect to practising certificates on (08) 6211 3600.