Professional services disputes and insolvency: Q1 2026 signals persistent pressure

Solomonic’s latest insight suggests that litigation is on the rise against a backdrop of “ongoing global uncertainty". Two areas stand out for those focused on professional and financial risks: a notable uplift in claims involving professional services firms, and renewed momentum in insolvency-related actions.

Professional services: more claims, and often as defendants

In Q1 2026, Solomonic confirmed that the professional services sector saw over 300 claims filed. This represents a 45% increase compared with data from Q1 2025. Importantly, Solomonic notes that, in more than half of these cases (54%), the defendant operates in the professional services sector. This data will come as little surprise to professional indemnity insurers, in-house risk teams and defendant panel firms, who have anecdotally reported an unusually high volume of claims in this sector since the turn of the year.

For risk teams, a rising number of claims involving professional services (and a majority where the sector is on the receiving end) may reflect increasingly hard-edged/litigation focused commercial behaviour. This can arise due to clients scrutinising outcomes, costs and project delivery more closely, as well as counterparties reacting faster when financial stress arises. It may also lead towards a general shift with parties preferring formal dispute resolution rather than seeking negotiated settlements.

This may also serve as a reminder to keep an eye on the classic tension points that can generate professional services litigation when market conditions tighten. These can include allegations of scope drift, fee pressures, as well as those claims arising out of documentation gaps created by fast-moving instructions. It is important that professional services firms continue to strengthen record-keeping practices, keeping clients up to date with fee budgets, supervision and deadline management – all of which are hallmarks of many professional negligence actions.

Insolvency: the busiest period since 2020

On the insolvency side, Solomonic's message is starker. Q4 2025 hinted at a possible slowdown in the Insolvency and Companies List, but Solomonic's data indicates there were more than 4,100 new actions in Q1 2026, making it the busiest period since 2020.

Solomonic have indicated that the reason this activity remains high is due to the increasing number of winding-up petitions, which it confirms have increased by 12% from Q4 and now make up 53% of the insolvency filings in Q1. Solomonic gives this total as more than 2,170 petitions.

For professional services firms, the insolvency trend can lead to double exposure: first, through unpaid invoices and recovery actions; and second, through the increased likelihood of disputes as distressed businesses, office-holders and funders assess potential claims as a means to recover losses. This could be persistent based on The Insolvency Service's statistics for March 2026, as the data shows that there were 2,022 company insolvencies, 7% higher than in February 2026 (1,895), and at a similar level to the same month in the previous year (1,995 in March 2025).

Takeaways for Professional and Financial Risks

Three near-term focus points emerge from these figures:

• Expect more defended professional services disputes: claim volumes are up, and the sector is frequently in the defendant seat.
• Stress-test credit and engagement hygiene: insolvency volumes suggest risks remain at a high level.
• Preservation of documentation: as pressure rises, contemporaneous documents and clear scoping can be key to determining viability of claims.