Salim Bashir said the proposed SIF scheme represents a long-term goal of the Bar. He said the Bar Council, which manages the day-to-day affairs of its members, must ensure that the SIF fully complies with all regulatory requirements.
“We must make sure we are exempted by Bank Negara from any obligations under the Insurance Act 1996 and its regulations,” he said.
Salim said the council also needs to consider the jurisdictional practices adopted by other Commonwealth countries that have introduced the scheme.
“In light of the exposed legal risk and liabilities involved, it is important that the Bar Council determine the vehicle to be established to run the SIF scheme and how to implement and oversee its day-to-day operations,” said Salim, who held the top post during the 2020/21 term.
However, another past president George Varughese took the opposite view, saying there was no necessity for the Bar to secure the central bank’s approval since it would not be carrying out an insurance business.
“This is a self-indemnity fund where the Bar will cover lawyers against professional negligence for the mandatory coverage of RM250,000, ” said Varughese who was president between 2017 and 2019.
He said all discussions with BNM and all other matters pertaining to the scheme have been discussed and resolved.
“All we need is a council that has the will to implement the SIF scheme that was endorsed again by members at the Bar’s annual general meeting this year,” he said.
Varughese said the Bar’s professional indemnity insurance (PII) committee has drawn up rules which received approval from the Attorney-General’s Chambers more than a year ago.
The duo’s comments come after another former president endorsed a group of lawyers seeking election to the council on the back of a promise to implement the SIF scheme which lawyers first voted for in 2009.
Kuthubul Zaman Bukhari urged the 24,000-strong Bar to vote in the 16-member alliance, named the “progressive group”, which has promised to lower the cost of insurance premiums significantly.
He said the SIF scheme, if implemented, will likely see the annual mandatory premium payment, which currently stands at RM1,000, reduced by up to 40%.
Kuthubul, president from 2003 to 2005, said the current insurers were making some RM12 million in profits each year.
The Bar’s professional indemnity insurance (PII) committee has to date raised approximately RM39 million for the SIF scheme, which the Bar Council continues to hold.
Forty-two lawyers are vying for 16 seats on the Bar Council next term.