ARC LEGAL WELCOMES REGULATOR’S DECISION ON PUBLICATION OF ADD-ON INSURANCE CLAIMS RATIOS

Arc Legal Assistance (Arc Legal), a leading Legal Expenses Insurance (LEI) provider, has welcomed the Financial Conduct Authority’s (FCA) decision not to require insurers to publish claims ratio information for add-on products.

Commenting on the decision, Richard Finan, Director of Arc Legal, said: “We have consistently questioned whether the publication of claims ratios at the point of sale of an add-on legal expenses product would reflect its true value, and provide an accurate measure of the benefits it offers the consumer. Therefore, we welcome the FCA’s decision not to push for this information to be published.

“We fully support the drive for add-on clarity and transparency. However, claims ratio data will not include important aspects such as the services provided to customers which are not shown as payments by underwriters, as well as the claims and legal costs funded under a policy during the life of the claim. We believe these wider factors need to be taken into consideration to truly demonstrate the value to consumers.”