Arc Legal welcomes any feedback so please feel free to email us with your comments.
Contact Alex at Concise Public Relations Email:
Tel: 020 7100 3960
14th January 2010
Helen Withers, Managing Director of Arc Legal responds to comments from DAS on the future of the UK's add-on legal expenses insurance model.
Why is Paul Asplin sounding the death knell for the UK legal expenses model (DAS warns UK model may have "run its course" after £10m loss - 31st December/7th January issue), when alternative UK business models are already demonstrating that add-on legal expenses can deliver both a responsive service and profit? Perhaps it is time for him to look at the issues closer to home.
To state that the UK model could be replaced by a continental model is disingenuous. The differences between the UK and continental legal systems are such that a model along continental lines would be unworkable in the UK, so such a suggestion is a total non starter.
The question is more about whether the DAS business model is sustainable against increasing competition, changing market demand and regulatory and government pressure for change. Is it possible that DAS, responding to the competition posed by new, more efficient, business models in the sector, has simply reduced its rates to an unsustainable level while maintaining its traditional operating model - maybe a clue there to the £10m loss?
Arc Legal has built its business on the basis that we recognised, as far back as 2003, that the future of the traditional legal expenses model was limited and that the operating structures and costs of the large providers would face ever increasing pressure. DAS's situation, as well as the recent withdrawal of Capita from the legal expenses insurance market is now showing that the traditional ways of doing business are becoming less relevant year on year and, that as in other sectors, innovation is the key to business growth.
Arc Legal Assistance
A version of this response appeared in Post Magazine on 14th January 2010.