ARAG enhances winning formula for Landlords

New and existing private sector landlords can expect much more from their revised ARAG legal protection policy without ever making a claim. Landlords Legal Solutions has been completely re-written and now includes more free legal documents from its digital documents service as well as higher benefits and fewer restrictions or excesses.

Our landlords' policy was already the complete package and you don't spoil a winning formula but you do make important improvements around the edges. Key to this approach is the use of even clearer language, generous uplifts in benefits and the removal of excesses or other complications.

We want policyholders to know exactly what they are getting cover for and to make use of the free added-value services such as helplines and document services. Experience tells us that these additional services are highly valued, giving significant peace-of-mind to landlords, and helping agents retain business even when no claim has been made.

Substantial increases have been made to benefits. Alternative accommodation for landlords when vacant possession is impossible now stands at up to £175 per day, maximum £5250, with storage refunds up to a maximum of £300 also being covered.

Standard cover includes: repossession; property damage, nuisance and trespass (now without any excess); recovery of rent arrears; accommodation and storage costs; prosecution defence; plus the landlords' legal service website online law guide, monthly newsletter, tax and 24-hour legal helplines. Legal documents available free to landlords now include the licence agreement to rent a room, plus the most commonly needed customisable texts such as the initial letter concerning rent arrears, the demand for rent from tenants, plus section 8 and 21 notices(notice to quit, notice of repossession).

Three optional extensions remove worries over non-payment of rent, disputes over contracts or the tax affairs of the policyholder. Rental indemnities are offered with a choice of compensation for 5 of the first six months in arrears or 11 out of 12 months on a yearly option. Contracts for such work as construction, or designing, converting or extending any building, are covered up to £6000 including VAT. The cost of defending investigations into landlords' tax affairs by HMRC can also be added to the cover.

David Haynes

Head of Underwriting & Marketing

Expansion continues at ARAG following record results

ARAG is continuing its expansion programme with recruitment across the board, having just announced record trading and profits and the expectation of more to come.

Of eight new starters, the latest recruits are Peter Collins and Lisa Abrahams who are now working in the South East for the BTE (before-the-event) and ATE (after-the-event) sales teams respectively. Both are well known in the field of legal protection with backgrounds in insurance and the law.

Peter's career has taken him from the Magistrates Courts to legal protection and a solicitor firm, before starting with ARAG as Broker Account Manager. He will concentrate on the Home Counties (apart from the City) where he believes there are significant new business opportunities to develop and maintain profitable scheme business, whilst continuing to provide support and service to all clients.

Lisa also joined ARAG at the start of July. After 13 years in legal expenses, firstly as BTE claims handler then later as Business Manager and transferring to ATE as a senior underwriter, she has an extensive mix of legal and insurance knowledge to assist in the role. An associate member of CILEX (Chartered Institute of Legal Executives) she is developing new relationships with solicitors in the South East and maintaining existing ones.

Refurbishment and expansion of ARAG's Bristol Head Office was completed earlier in the year. An increase of over 60 % working space was acquired to accommodate the staff needed to meet projections of continuing growth in the medium to long term.

ATE premiums remain recoverable for Mesothelioma Claims for the time being

Last December the Government announced its intention to apply sections 44 and 46 of the Legal Aid Punishment and Sentencing of Offenders Act 2013 (LASPOA) - which prevent winning claimants recovering their lawyer’s success fees and their ATE premiums from defendants - to Mesothelioma cases with effect from July 2014. This position was confirmed in March this year however LASPOA also provided that sections 44 and 46 could not be brought into effect until Ministers had carried out a review.

The Justice Select Committee’s third report which was released at the beginning of this month revealed that there were starkly opposing views on this matter. While representatives of mesothelioma victims, claimant lawyers and trades unions argued that special characteristics of mesothelioma claims made it necessary to maintain their exemption from sections 44 and 46 LASPOA, the Government, defendant lawyers and insurers considered continuing the exemption was not justified. The Select Committee noted that debate in both Houses on LASPOA showed that the package of reforms was controversial, and especially so in relation to mesothelioma cases.

The Government’s cost-benefit analysis assumed that ATE policies would no longer operate and suggested that there would be a net overall benefit to claimants whose 10% increase in compensation would outweigh the cost of success fees and ATE premiums. The Select Committee cited the analysis as “an exercise in premature conjecture” since insufficient time had elapsed to assess what the likely effect of the proposed reforms will be.  The analysis was not accepted by the Select Committee as being reliable and it was recommended that the Government commission an independent review of mesothelioma claims outcomes.

The process of the Government’s review was found to be poorly timed and “maladroit” as it had been “shoehorned” into a wider consultation on the claims process.  The Committee expressed concern that by entering into a “Heads of Agreement” with the Association of British Insurers, representing the interests of defendant insurers the Government had not been transparent and open and the agreement had shaped Government policy. 

The Committee’s overall conclusion was that the Government review had not be approached in an even-handed way and it recommend that a further review by means of a consultation framed unambiguously and centrally on the question of whether the LASPOA provisions should be brought into effect for mesothelioma should be carried out only when sufficient time has elapsed for the effects of the LASPOA changes in non-mesothelioma cases to have been assessed. The Committee also recommended that the Government commission research to evaluate trends in the ATE insurance market in relation to personal injury claims since the provisions of Part 2 of LASPOA came into force.

So, with regard to ATE insurance for mesothelioma cases, it’s business as usual with premiums remaining recoverable for the foreseeable future. We will be announcing some interim changes to ATE premium rates shortly however it could be some considerable time before “post LASPOA” models apply to these cases compressing the risk and causing rates to tumble significantly.   

Lesley Attu

Product Development Manager

Thinking 'outside-the-box' secures telematics insurer contract for ARAG

Legal expenses insurance provider ARAG has recently announced a partnership with specialist telematics based Insurethebox and will be providing legal cover for around 250,000 of their policyholders. Mandatory legal expenses insurance is now incorporated in the standard car policy for all customers and can be supplemented with an enhanced package which includes replacement vehicle cover for at fault, fire and theft claims together with car cloning cover, motor prosecution defence and legal services assistance such as legal, tax and counselling helplines.

It is possible to provide such significant policy benefits to drivers as young as 17 because they have shown their commitment to safer car ownership when agreeing to have their driving style monitored by the in-car 'black box'. Up to 21 days' insured car hire is available following total loss arising from a fault accident, fire, theft or vandalism so that the policyholder can remain mobile in the event of a claim.

“Those who have opted for safer driving rewards may still become involved in accidents through their own inexperience”, comments David Haynes, Head of Underwriting & Marketing at ARAG. “We can provide the benefits that many will not even know they need until such time as they have a claim. Adding all these safeguards early in their driving experience complements a reward-based approach to insurance and hopefully influences their buying choices for the future”.

Car cloning cover has a particular significance as increased automatic number plate recognition (ANPR) surveillance reveals previously undetected cloned vehicles on the roads, with fixed penalty notices or notice of intended prosecution arriving through the letterbox. Typical claims involve appeals against parking fines or allegations of a criminal offence having been committed. ARAG cover helps defend, mitigate and resolve difficulties that ensue and is twinned with ID theft protection as well as helplines to advise and support victims.

ARAG predicts this innovative cover is the precursor to a new generation of specialist policies that, over time, will become far more mainstream.

Landlords’ legal issues

How our cover can help

Landlords’ Legal Solutions protects private landlords of residential property against legal costs. A number of

different types of dispute are covered however the most significant policy feature is cover for repossession.  A typical claim would involve a tenant failing to pay rent which results in a landlord seeking repossession of their property along with recovery of the rent arrears owed to them.

Repossession

The policy covers mandatory grounds for repossession where property has been let as an assured shorthold tenancy, short assured tenancy or assured tenancy under the 1988 Housing Acts in England, Wales and Scotland.

Cover is also available to repossess if your property has been let to a business for an employee to live in, where you are a resident landlord and have licensed a room to a lodger, and for landlords in Northern Ireland.

Most repossession claims occur because the tenant has fallen behind with their rent. To obtain repossession it is essential that you have fully complied with the rules about protecting tenant deposits and you are required to correctly serve notice to the tenant to quit the property. Failure to do either of these things will interfere with your legal right to repossess.

Eviction

Different notices apply to terminate a fixed term tenancy (Section 21 in England and Wales or Section 33 in Scotland) while a Section 8 notice will need to be issued where the tenant has defaulted and two calendar months’ rent arrears have accrued. On service of a Section 8 notice the tenant has 14 days to pay up or leave. We can appoint a lawyer to issue eviction proceedings against your tenant if the notice to quit fails to have the desired effect provided that you chased your tenant for rent as soon as it became overdue.  You must also tell us that you wish to claim within 60 days of rent becoming overdue.   

Optional cover

To provide additional security and peace of mind, our Landlords’ Legal Solutions has optional cover to provide rent guarantee cover. This additional protection comes into force upon acceptance of a claim for possession and/or arrears and will pay the landlord from the second month of rent falling into arrears for five months under our six month policy or eleven months under our twelve month policy.

Website information guide

Our on-line law guide provides all the information you need to know about protecting your deposit and about serving notice to quit. You can also down load letters for references, tenancy agreements, Section 8 and 21 notices and various other free documents such as a letter demanding unpaid rent.  The legal services website is at www.araglegal.co.uk watch the two minute video tour from the home page to learn more about the site before entering your voucher code to register.

Helplines

If you prefer to speak to someone about a legal matter affecting your property our legal advisers are available 24/7 to provide free advice over the phone.  

 Lesley Attu

 Product Development Manager