We were very surprised at both the timing and content of the new Law Society LEI survey. The recent appeal cases of Webster Dixon LLP and Equity Syndicate Management/ Motorplus Limited t/as ULR Additions in England; and Sneller and DAS Nederlandse Rechtsbijstand Verzekeringsmaatschappij NV in the Court of Justice of the European Union have reinforced already firmly established rules of what is allowed and what isn’t when it comes to policyholders’ rights to choose their own solicitors and an insurer's liability for lawyers’costs. Essentially nothing has changed.
Here at ARAG we have a substantial solicitor panel with no in-house handling carried out. We do not own an ABS and have no intention of competing with solicitors. With this in mind ARAG, together with other legal expenses insurance providers, have engaged with the Law Society over recent years to find common ground and a positive way forward with solicitors. Most recently, at the end of last year, discussions focused on establishing a non –panel solicitor agreement, to ensure consistency and fairness when a non-panel solicitor is engaged.
We were disappointed to see the Law Society take such a negative stance on LEI insurance, particularly considering that the survey is very unlikely to yield anything new in the way of solicitor opinions on freedom of choice. The rights of the customer are always our primary concern and there is no evidence to support the notion that reputable LEI providers are routinely or even occasionally, unfairly denying policyholders their rights in this area.
In our view, the survey seems very one-sided, almost to the point of being misleading. ARAG fully accepts that policyholders must not have claims “shoehorned” to inappropriate lawyers, and indeed, we will routinely try to match the type and complexity of the claim with the right firm and individual within that firm; where Counsel is required, they will also be suitably experienced. Provided an appropriate lawyer is appointed however, it remains to be shown what detriment there is to the client in having a panel solicitor appointed. Our experience shows time and time again that panel lawyers have better success-rates than non-panel firms, but at a much lower cost. Both outcomes are of course beneficial to policyholders in direct and indirect ways. We would therefore question whether, at the heart of the survey, the intention is to serve the interests of the client (which of course remains a solicitor’s overriding duty) or rather members of the legal profession that do not happen to be on an insurer’s panel.
Head of Claims
Link to Law Society comment on survey