Firms which conduct low-value work only could still face a large Professional Indemnity (PI) claim, it has been warned.

Liability management firm Legal Risk warns in its July 2007 Risk Update of the potential for numerous disputes to be combined into a single issue if they are deemed to have been brought about by the same initial cause.

The company advises that this could leave small firms facing a PI claim of greater value than any individual item of work they would normally undertake.

"Even firms who are not doing high-value work should bear in mind the risk of aggregation," writes risk management adviser Frank Maher.

He adds that under the terms of a PI policy, "claims from similar causes [may be treated] as one claim with one policy limit".

The company's PI and Risk Management Survey 2007 found that, at the start of the year, one in six firms had moved to a higher PI bracket in order to insure themselves fully against aggregate claims.

PYV's Director of Claims, Robert Bass, added that the danger of aggregation has always been there and firms should always have an eye to the accumulation of claims as well as individual losses.

The FSA prescription for calculating cover required is sound but firms should discuss any additional concerns with their broker especially if they operate in perceived high-risk areas and buy additional cover if appropriate.