BUSINESS UPDATE - Q1

Arc Legal’s response to ‘Customers with Road Traffic Injuries: The ABI Code’

The publication of the Association of British Insurers (ABI) Code of Practice for the treatment of customers with RTA injuries represents an important move in ensuring the benefits of Motor Legal Expenses Insurance (MLEI) are fully available and utilised by those with cover.

The Code states that where the customer has the benefit of a MLEI policy the insurer commits not to recommend a legal services provider who will contract with the customer under a Conditional Fee Agreement or Damages Based Agreement which would involve any deduction being made from the customer’s damages.

Arc Legal fully supports any move that ensures a customer with MLEI is able to access the full level of any compensation or damages they are awarded and that no deductions under these kinds of agreements should be taken. This is directly aligned with the Arc Legal MLEI model which operates on a non-deductions basis to provide claimants with 100% of their compensation.

The ABI’s efforts to remove deductions models from the MLEI market will help ensure that claimants are provided with access to justice when they are injured as a result of a non-fault RTA.

 

Arc Legal’s response to the FCA study on general insurance add-ons

The recently published FCA study on general insurance add-ons has proposed a number of changes to the sale and provision of add-on insurance products.

The study focuses on the sales process of add-on products, including customer awareness of the products they are buying and what information they are provided during the sales process. As part of the study, the FCA has outlined recommendations to improve the add-on market, including:

  • Banning opt-out sales processes
  • Publishing claims/loss ratios of the product at the point of sale
  • Improvement of the way add-on products are sold via price comparison websites, including what information is available to consumers
  • Improvement of the value and/or quality of add-on products
  • All firms to review the design, distribution and sales process for add-on products

While Legal Expenses Insurance products were not specifically targeted in this study, we are supportive of the findings, and are confident that our products provide real value to consumers. We support any move to give consumers greater clarity and a clear understanding of the cover they can access through add-on products.

As a leading provider of add-on Legal Expenses Insurance products, we understand our responsibility to provide business partners with support and assistance to ensure that add-on sales processes are compliant with any changes that may be introduced as a result of the study. We will be working closely with our partners to help implement any changes that may be required following the FCA’s expected final findings later this year.

Call us on 0344 770 9000