LEGAL EXPENSES INSURANCE SERVICES ARE MORE VITAL THAN EVER AS THE COST-OF LIVING CRISIS CONTINUES

Against the headwinds of inflation, and prices continuing to rise with no signs of slowing, we’re seeing more people seeking expert legal advice. From February to April 2023, we’ve seen the volume of calls to our Legal Assistance Helpline (LAH) increase by over 10% compared to the same period last year.

This is a significant and worrying trend that we believe could be due to several converging factors:

Financial pressures causing many firms offering free legal advice to close

A narrowing of the scope of issues that can be covered by legal aid

Restrictive legislation limiting access to aid

People wanting to explore more options to resolve claims before they escalate

People wanting to get value for money from their insurance products

The current economy causing rents to rise and companies to cut jobs leading to more employment and housing claims as people struggle to live

Undervalued and underused?

In this climate, the value of a Legal Expenses Insurance (LEI) offering has only increased, but many Britons historically either haven’t been aware of how the policy operates, or even that they have one they can call on in times of need.

LEI products are often sold as an optional add-on, when purchasing other insurance products and in the past, distributors have put less emphasis on explaining the benefits of LEI. As a result, many policyholders purchase an LEI product with only a vague idea of how the policies work, what they can cover and importantly, without being aware of the free legal advice that’s often attached to these policies.

Our data suggests this must change. UK policyholders are in greater need of access to justice, and an LEI policy can offer a relatively inexpensive route to obtain expert legal assistance whenever they need it.

How can an LEI policy help?

Many people simply don’t realise how often in their day-to-day lives they run the risk of needing legal assistance. Few of us expect to ever need to go to court to defend a claim, but the policy supports more than just this scenario and includes legal advice on employment, property disputes, family law, wills and probate, tax affairs, contractual disputes, clinical negligence and much more.

We also prefer to offer a range of alternative dispute resolution options to help mitigate the chances of a claim going to court. Think of LEI as having a legal expert in your pocket to guide you through hundreds of everyday issues.

12 months of legal advice

I think policyholders are starting to become more aware on the value of LEI, helped in part by the FCA’s Fair Value considerations and Consumer Duty. This puts the onus on distributors to thoroughly research and educate customers on the value of the policies they’re buying; we hope this will increase awareness and utilisation rates.

Last year, our 365-day, 24/7 Legal Assistance Helpline took over 44,000 calls and issued over 32,000 pieces of legal advice, and if the trend we’ve been seeing over the past few months continues, 2023 could well outstrip that.

We believe it’s important for everyone to have equitable access to justice, and in the current economy, the need is greater than ever. The data bears this out; Britons are actively looking for help and we must be ready to respond.

Rebecca Conway, Chief Legal Officer, Arc Legal Group

For further information on the above, or details of our products and services, please contact your Partnerships Manager or email enquiries@arclegal.co.uk.