An investigation by the Financial Services Authority has found no evidence that insurers discriminated against black and ethnic minority law firms during last year’s professional indemnity insurance renewal.

Following interventions from the Solicitors Regulation Authority and Equality and Human Rights Commission, the FSA was asked to investigate whether BME firms were being discriminated against.

Some BME lawyers had complained that they were refused cover or given higher quotes because of the ethnicity of the lawyers running the firm.

The FSA said that following its investigation it had ‘not identified any practices’ that point towards discrimination by insurers.

It added: ‘There are likely to be credible legal arguments that form part of the legitimate exercise of a firm’s commercial judgment.'

However, the FSA has reminded insurers to ensure they are compliant with their legal obligations when deciding to provide or refuse cover.

It said insurers should also have appropriate controls in place to avoid the risk of unlawful discrimination arising from their risk-based underwriting practices.

Following a meeting with the EHRC last October, the Association of British Insurers agreed to develop guidance on the Equality Act for insurers, and publish aggregated industry data on some of the risk factors of greatest concern to BME firms.

It is understood that the EHRC has indicated that it is satisfied with the actions taken by the FSA, and considers that the most appropriate way to proceed is to pursue the commitments made by the ABI, which will promote best practice.

The SRA said it will continue to investigate any specific complaints it receives about qualifying insurers and will review the data provided by the ABI.