Children's Hospice Southwest Santas on the run

ARAG scores double with its underwriting service

Professional brokers have once again voted ARAG as the best Legal Expenses Team at the Underwriting Service Awards (20 November 2014) at the Royal Garden Hotel in London. From a strong short-list of four providers nominated through a detailed survey, ARAG followed success in the inaugural 2013 award with another outright win this year. They also scored highest out of all 13 winners, across all categories, to scoop for the first time the prestigious “Underwriting Service Awards Team of the year” against strong market competition.

“The awards are a true reflection of opinions that are uppermost in brokers' minds”, comments David Haynes, ARAG Head of Underwriting and Marketing. “Organised by the Incisive Media (publishers of Post Magazine and Insurance Age), they provide an accurate snapshot of how your people are perceived so it is gratifying to know that ARAG is held in such high regard.

“There have only been two opportunities to win and ARAG has triumphed at both. Winning the “Underwriting Service Awards Team of the Year” has really been the icing on the cake, we are thrilled. Receiving both of these awards reinforces our determination to provide something that is distinctly different and definitely better. What's more, this arrives just one week after we won the award for Insurance Provider of the Year at the Personal Injury Awards 2014, the third time in a row for our after-the-event team”.

Now in their fifth year, the Underwriting Service Awards are unique. They are based on large-scale objective input from UK commercial and specialist broking professionals, submitted through the annual Business Insurers Insight Study. Brokers graded the insurers they have worked with during the previous 12 months before verification and analysis of scores determined the winners announced at the awards ceremony on 20 November.

“As we develop our product profile in new areas it was important not to lose focus on our key values of innovation, service and independence so we are delighted that our broker partners have recognised this with their votes once again”, adds Mr Haynes.

Falling foul of employment law no longer 'inevitable'

As the holiday pay row heads for a review and possibly to the Court of Appeal, it's no wonder that many employers regard mistakes and Employment Tribunals as being an inevitable part of business life. But it doesn't have to be that way.

Those holding ARAG commercial legal protection cover benefit from guidance that can steer them through the constantly changing minefield of legislation, legal challenges and appeals that define correct procedures. Advice from ARAG is available online and from telephone helplines, so it's up-to-the-minute-correct and complemented by regular newsletters and e-mail alerts.

“Employment queries are by far the most common problems our teams are asked to assist with”, comments David Haynes, ARAG's Head of Underwriting and Marketing. “Even the most experienced HR professionals know how easy it is to get things wrong and constantly check with us on the latest situation. For smaller employers, with fewer resources, the helplines and on-line guides prove invaluable in day-to-day problem solving. Everyone wins”.

Recent headlines highlighted three similar disputes in a ground-breaking case at the Employment Appeal Tribunal (EAT); this resolved whether regular overtime, bonus payments or other 'normal' supplements should be included in holiday pay. Yet this is not the full story and a number of grey areas still exist. Voluntary overtime, backdated claims and the 'urgent' government review – let alone that possible Appeal Court application – muddy the waters.

On the face of it, the EAT ruling suggests that UK companies have been interpreting the EU Directive wrongly.  As things stand today employers should be paying supplements and overtime as part of holiday pay. They should also be putting right any underpayments, provided the interval between underpayments is no greater than three months. Any ruling referred to the Court of Appeal could mean that the absolutely definitive decision may be years away. In the meantime, policyholders can check ARAG free advice services for the current position.

Quarterly landlord repossession claims July – September 2014

A landlord possession action starts when a claim is submitted to the courts to repossess a property. The most common reason for repossession is arrears of rent. The court process of possessing a property follows four stages:

·         A claim for a possession being issued by a landlord;

·         An order being made by the County Court.

·         If the defendant fails to leave the property by the date given in the order the order may be enforced by a warrant of possession. This authorises the county court bailiff to evict the tenant. The bailiff then arranges a date to execute the eviction; and,

·         Repossession by a County Court bailiff.  Repossessions may occur without county court bailiffs, through less formal procedures, so the actual number of repossessions is usually greater than the number carried out by county court bailiffs.

The MoJ has today released quarterly mortgage and landlord repossession statistics for the period July to September. There were 40859 claims for repossession in July to September 2014.

There were 11,100 landlord repossessions by county court bailiffs; this is the highest quarterly figure since these statistics were first collated in 2000.

Lesley Attu

Product Development Manager

For information on our Landlords Solution policy http://theragnbone.blogspot.co.uk/2014/10/all-leaves-are-brown-and-sky-is-grey.html

To Contact our Sales Team

http://www.arag.co.uk/index.asp?m=93&s=431&t=Meet+the+Sales+Team

Catch us if you can

………… One of our competitors hasn’t done their homework properly and has written to solicitor firms about the value of legal protection for disputes arising from restrictive covenants in employment contracts, giving the impression that such cover is a USP.  We won’t embarrass the firm but suffice to say they’re not quite up to the mark. They must have missed the relaunch of our commercial product range back in April. Just to put the record straight our Absolute, Essential and EPL products all provide cover to pursue or defend actions arising from an alleged breach of a restrictive covenant in an employment contract. You wouldn’t expect anything less from us would you?

Lesley Attu

Product Development Manager

Out and about with Sales

At the end of October, we were delighted to pay a visit to our friends Cornish Mutual at their office in Truro. Our Chief Executive Tony Buss and Product Development Manager, Lesley Attu joined our sales team, Head of Sales Andy Talbot and me on the trip down the M5.

ARAG started dealing with Cornish Mutual at the beginning of 2013 and since then things have rapidly developed so that we now supply all of Cornish Mutual’s ancillary product requirements. We believe the reason for this success is a shared philosophy of excellent customer service and a collaborative spirit which has enabled products to be developed and delivered on time. This trip was an excellent opportunity to increase our understanding of the customers’ requirements.

We met at Cornish Mutual’s purpose-built offices and their Managing Director Alan Goddard showed us round and introduced us to some of the team. After this we set off to meet one of Cornish Mutual’s Members a farmer call John Sawle, Cornish Mutual’s local Insurance Inspector Jeff Kincaid kindly showed us round, Jeff has worked for Cornish Mutual for 40 years and John’s farm has been insured with Cornish Mutual for 100 years. This says a lot about the long term approach that the company has to its relationships with Members.

The tour of John’s farm exceeded all expectations. It was a joy to listen to a man at the top of his profession. We were shown round three farm locations and learned about the cereals and use of the land. We were also shown the livestock and were advised of the challenges in keeping them.

We also went to the maintenance shed where we saw the world’s only working steam tractor.

I think we all came away much wiser.

We then adjourned for lunch at the well-known Castaways restaurant in Mylor and returned home after a very enjoyable trip. Thanks to Claire Longman for organising the day and also to Mitch Portman and Paul Mahon for their company.

John Gray

Corporate Account Manager

Legal Ombudsman to hear CMC complaints

The MoJ has considered responses to its May 2014 consultation document “The Legal Ombudsman and complaints about claims management companies”.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/369748/legal-ombudsman-and-complaints-about-cmcs-response.pdf

From 28^th January 2015 the Legal Ombudsman will offer consumers a free route of redress if they have a complaint about a regulated claims management company (CMC). The fee structure has been designed to make the scheme wholly self –financing and is based on the turnover figure of the CMCs.  Annual charges are shown below however pro-rata charges will apply for the initial period until 1 April. 

Where the annual turnover of an authorised CMC is £163,636 or less, then the amount payable will be a fixed fee of: Turnover band £	Annual Fee
Up to £24,999.99	From £75 - £250
£25,000 – £74,999.99	£340
£75,000 – £163,636	£540

Where the annual turnover of an authorised CMC exceeds £163,636 businesses shall pay an amount equal to 0.33% of annual turnover up to £1 million, plus 0.22% of annual turnover between

£1 million and £5 million, plus 0.18% of annual turnover above £5 million.

Fees are capped at £40,000.

The MoJ estimates that the Legal Ombudsman scheme will consider 3,000 complaints from consumers a year. The Claims Standards regulator will continue to deal with complaints about unregulated businesses and to investigate misconduct.

Lesley Attu

Product Development Manager

All the leaves are brown and the sky is grey

Hearty casseroles and soups, the rugby season and chatting in the office about the Christmas party; it must be autumn. At this time of year we all crave the last glimpses of light and finer weather before the clocks fall back an hour, signifying the end of British Summer time. As the nights draw in you want your home to be warm and cosy, somewhere to hide away from the worst of the winter weather.

If your boiler won’t work or a freeze causes a burst pipe it can make things really uncomfortable.

Many people in the UK don’t know about Home Emergency Insurance or think that their home insurance covers it. Here at ARAG, we need your help and expertise to spread the word about how our Defaqto 5 star standard product plugs the gap.

This is a typical example of the way our cover helps customers.  During a particularly cold snap last winter, on a Saturday morning, our insured’s boiler broke down. The lady had three young children, so they were naturally keen to resolve the problem as soon as possible. The insured contacted us and we immediately appointed a contractor who attended the same day. A replacement part was needed but thankfully this was available locally so was fitted immediately so the family was able to enjoy the benefits of a cosy home.

Help is available when needed most. Our service operates 24 hours a day, 365 days a year and for additional peace of mind all our permanent repairs are guaranteed for 12 months. An emergency is a stressful situation and people expect things to be rectified fast. That is why we have chosen our partners very carefully and constantly monitor performance to maintain great standards.

So as we prepare for a busy period of emergency calls, now is the best time to advise that our Home Emergency Insurance cover will help keep your customer’s home safe and comfortable to live in.

Glynis Moss

Marketing Executive  

The importance of BTE insurance as a funding option

I first worked with Rocco Pirozollo general editor of the Law Society Litigation Funding Hand Book when we both sat on the ABI’s Legal Expenses Insurance committee many years ago and more recently when I chaired an ABI-sponsored but independent working group which reported on consumer aspects of BTE. I was flattered to be approached by Rocco towards the end of 2012 to write a chapter of “the handbook”.

Rocco’s vision was to provide comprehensive practical help to busy litigators following the Jackson reforms. He has written three chapters of the book himself while inviting others to contribute the different chapters according to their fields of expertise. The project moved slowly for a time as reforms were rolled out and new cost rules published but earlier this year it was full steam ahead and it was great to see the book published in September.

The panel litigator system that legal expenses providers operate is disliked by many law firms so it may not be surprising that the BTE chapter is tucked away at the back of the book.  However, legal expenses policies provide welcome financial support to consumers and businesses. At ARAG we aim to be fair to our customers and to their preferred law firm when freedom of choice of lawyer applies.  My hope is that by being fully informed of pros and cons of many possible funding options litigators will feel more comfortable about recommending BTE as a preferred method of litigation funding.

Lesley Attu Product Development Manager

http://www.litigationfutures.com/blog/a-handy-handbook

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

Problem with your Tenant? Our Landlords’ Legal Solutions is here to help.

So how does the claims process work?

A typical dispute with a tenant involves them failing to pay rent which results in a landlord seeking repossession of their property and recovery of the arrears owed to them. If this happens then you need to start by serving the correct Notice on the tenant, examples of these, along with covering letters, can be obtained from the ARAG Legal Services website Link.  If you are in doubt as to which Notice to issue, you can call the ARAG legal helpline (a 24/7 service) for free advice.

If the arrears are outstanding for two calendar months, you will need to submit a claim to the ARAG Claims Department. This can be done in a variety of ways, including post or email. Our straightforward claim form lists all the information we need to assess the claim and our Claims Team are here to assist with any queries which may arise.

We will then provide an assessment on cover and, upon acceptance of a claim; we will appoint a law firm who specialises in landlord & tenant disputes. The lawyer will then proceed to deal with the legalities of obtaining possession of the property from the tenant and obtaining an agreement to repay, or a Judgment against the tenant for any monies owed.

We cannot always guarantee recovery of arrears if a tenant does not have the means to satisfy a Judgment. However, we understand the most important part of a claim like this is to ensure that vacant possession of the property is obtained as quickly as possible. Our Landlords’ Legal Solutions enables the landlord to achieve this and provides them with peace of mind and financial support should a dispute occur.

Chris Millward

Claims Assistant Manager

Our thoughts on FCA final report into add-on insurance products

Background

·         To recap – the FCA’s provisional findings to its Market Study of add-on insurance were published in March.  The FCA concluded that competition in add-on markets is not effective and that markets were not broadly working for consumers, with add-ons products offering poor value for money.

·         The Provisional findings provoked 65 responses from the insurance industry and consumers which focused mainly on the proposed remedies.

What did respondents say?

• Some respondents felt the “waterbed” effect where core premiums are reduced when add-ons are purchased should be considered in more depth.
• Generally respondents considered that the FCA had failed to take into account differences between products in forming their conclusions and that remedies assumed “one size fits all”.
• The FCA’s Proposal to ban opt out selling and to improve the way in which add-ons  are sold on price comparison websites received broad support – which is echoed by ARAG.
• Feedback opposed FCA analysis of firm data centred on the use of value as an indicator of whether markets were competitive i.e. the “Sun light" remedy which proposes publishing the claims ratio.
• Respondents felt for a number of reasons that the claim ratio was not a good indicator of value or profitability. They challenged the detail of the FCA’s calculations and identified practical difficulties associated with implementation of this remedy; although the remedy was supported by one consumer group.
• Respondents challenged the FCA’s conclusions about GAP insurance and focused on the negative effect the deferred opt-in method of sale proposed by the FCA might have on the GAP market.

Key messages from The FCA

The final report does not provide information about the FCA’s remedy work which is ongoing but focuses on the feedback received.

·         Overall the FCA has concluded that the feedback has not changed their overall conclusion that competition for add-ons is not effective.

·         The FCA reiterates that they recognise the value that some add-ons can provide (including the convenience they offer to consumers) and…

·         …that there are differences between the five products in the study and between different general insurance products more widely.

·         The FCA will apply cross-market remedies only where findings suggest that markets may

       be affected more widely.

·         The FCA recognises that remedies must be proportionate, and wider market impacts and unintended consequences must be considered in determining the design of measures to be implemented.

·         The feedback received on remedies made clear that there are no easy solutions to the problems the FCA is seeking to address. In particular the FCA acknowledges that with regard to the Sunlight remedy there are several complex issues to address before such a measure can be introduced.

Next steps

The FCA will

• work closely with industry and other stakeholders, including through a series of working groups which will be launched shortly,
• consult on proposed remedies later in the year. The timetable reflects the complexity of the issues at stake and the FCA’s desire to take on board the feedback received.

ARAG’s position

·         ARAG has no experience of GAP insurance and cannot comment on proposals to remedy defects the FCA has identified in the GAP insurance market.

•       We support a ban on selling add-ons by requiring customers to opt out of the purchase when they buy a core insurance product.
•       Our particular interest is in the “Sun light” remedy. We look forward to playing an active part in supporting the FCA to implement this remedy  so that it provides meaningful information to consumers and does not have unintended consequences.

We are concerned that unless the remedy can be refined consumers;

·         will be misled about the actual value of products since the FCA admits that no such measure currently  exists

·         will lose the convenience and protection of add-on insurance,

·         could be nudged towards expensive stand alone products (which will escape the requirement to disclose claims ratios ) and

·         will find that in the future added value features such as telephone legal advice and free digital legal documents, which are currently included within legal expenses policies but not reflected in the claims ratio, will be withdrawn.   

Lesley Attu

Product Development Manager

Trading times are tough …..

The Financial Times recently reported on the burden of late payment borne by small businesses http://on.ft.com/1sJMBMt. 

The article refers to data published by Bacs Payment Schemes, the direct debit company. BPS estimates the debt burden on SMEs is £39.4bn, up from £30bn in 2013 and higher than a previous peak of £37bn in 2012.

•  The research established that 60 % of SMEs are experiencing late payments, with the average company waiting for £38,186 in overdue payments.
• 72% of companies in the manufacturing sector were affected by overdue payments, followed by those in services (63%) and the transport, retail and distribution sector (48%).
• Businesses are incurring additional costs of £9.16bn a year because of late payments, with almost a third saying they were spending around £500 a month as a consequence of money owed to them. This figure could be as high as £10,000 a month as a result of the various costs associated with bad debts, including overdraft fees and administrative costs.
• One in four companies is spending more than 10 hours a week chasing late payments.
• The knock-on effect of late payments meant that a quarter of companies were being forced to pay their own suppliers late, with one in five saying late payments are forcing them to rely on bank overdrafts.

Mike Cherry, national policy chairman at the Federation of Small Businesses, said: “These latest figures are a further reminder of the major headache caused by late payments. Not paying on time and lengthy terms can have a seriously detrimental impact on small firms”.

…..ARAG can help 

• Our Essential Business Legal and Absolute Business Legal policies offer Contract and Debt Recovery as an optional cover.  Provided that there is a reasonable chance of obtaining and enforcing a judgment the policy pays legal costs and expenses up to £100,000 to pursue recovery. 
• Whether or not policyholders have Contract and Debt Recovery in force they can contact our 24/7 legal advice helpline for advice about their legal rights.
• The ARAG legal services website provides an on-line law directory and a range of on-line legal documents which registered users can create for free. www.araglegal.co.uk Policyholders who are new to the site can watch a two minute site video from the home page. They will need to enter their voucher code to register to create their own user ID and password. This is very simple and once it has been done policyholders can select documents from a menu and watch their document take shape as they build it on line by responding to on screen prompts. Guidance note accompany all documents. 
• A solicitor review service is available for some documents which are subject to a fee.

More about on-line legal documents

Policyholders can manage debt problems before they escalate by using our on-line legal documents. On-line documents can be created in minutes and stored securely on-line. 

      The debt recovery pack contains a suite of letters, or individual items can be selected, including;  

• Acknowledgement of a debt
• Guarantee for the payment of a debt (where the creditor has commenced legal proceedings against the debtor)
•  A reminder letter for an unpaid invoice
• Debt collection letters for unpaid invoices – an initial demand letter requiring payment for an overdue invoice, and a second letter to be used as letter before action if there is no response to the first letter.
• County court claim forms for debt recovery (Note – where debt recovery cover is operative policyholders can claim under their policy and we will take of this for them).
• Assignment of a debt.

Businesses can save significant additional costs and time as well as avoiding the knock on effects of late payments. If you sell Essential or Absolute Legal Solutions make sure your clients have their voucher code and get them to register straight away.

If you would like details of our commercial products please call us on 0117 3072278. 

Lesley Attu

Product Development Manager

Time flies by when you are having fun

I’ve already been here for two months and I must say that the time is flying by. Only three month left to get to know all other departments I haven’t worked for yet. The product development department is my “home” – where I spend the most of my time here because this is where I original come from in Germany “product development and innovation department” headed by Dr. Maslaton. But to know and understand the correlations of the UK insurance it is also important to learn more about the processes and structures of all the other main departments. Until now I worked for marketing and Claims Management Unit (CMU) both very interesting.

During my time here I have the chance to attend at two of your quarterly events. Fortunately one of them was the summer sports event on the Downs. Before this event took place I had no idea what to expect but know I can say it was a lot of fun with Ultimate Frisbee, Boule, Croquet and Giant Jenga.

Before somebody will ask – yes, we also played the games before starting to eat. Let’s have a look.

 

 

 

In Germany we only have one staff event a year but it is quite different. We aren’t as sporty as you, because of the size of the company it would be difficult to organize. The only activity we can do is dancing on the dance floor besides drinking and eating. But we have also a lot of fun and it’s always an amazing event, really good to get to know your colleagues offsite.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The ARAG bake off in aid of Pancreatic Cancer

Wednesday 18th June, one of the busiest days in the ARAG HQ calendar.  Sales had their quarterly meetings and the office swarmed with colleagues, including our remote staff. After work the whole company gathered for a social/sports evening on the picturesque Clifton Downs in Bristol. This presented the perfect opportunity to focus on our charity of the year Pancreatic Cancer www.pancreaticcancer.org.uk

Our bake off included a huge assortment of cakes and delicacies including a South Indian sweet ‘Mysore Pak’, a Polish speciality ‘Wisniowy Sad’, cherry chocolate cake, lime key cheese cake and peanut butter crunches. Our MD Tony claims to have tried them all.  Judith from Compliance went ‘off piste’ with her homemade beef pasties which went down a treat.

The bake off raised £321 and created a real buzz in the office, bringing together a mix of people from different departments, all committed to our Corporate Responsibility programme.  

In May we were overwhelmed by enthusiasm from staff, clients and suppliers who sponsored our business team to run the Bristol 10k. We raised £2,760. Thank you, to everyone who supported this event and for the many generous donations.

To find out more about our Corporate Responsibility programme please click here 

We hope you enjoy a glimpse of what we got up to during the day.

Are you prepared to be flexible from the 30th of June?

While flexible working is by no means a new idea it has gradually become more prevalent amongst employers looking to show they offer “a good work life balance”. Until now though, unless an employee had at least 26 weeks service and either children under the age of 17 or caring responsibilities, they did not have a statutory right to make a request for flexible working.

From the 30^th of June 2014 all employees who have 26 weeks employment will have the right to have their request for flexible working considered by their employer. The existing and some say inflexible procedures for dealing with such requests are being abolished, though the current eight reasons for declining a request will remain the same.

Going forward employers can use their own HR procedures to handle request but will have to prove the request has been dealt with in a “reasonable manner” and agree a decision within three months, unless an extension has been agreed. To help employers find their way through the new legislation ACAS has produced a draft code of practice. http://bit.ly/1kzSjrw

The ARAG Legal Services website www.araglegal.co.uk explains the law around flexible working and provides free guidance for employers and consumers.  Business policyholders can down-load a statement of changes in terms of employment for free and consumers can down-load a flexible working request application and an appeal letter at £3.99 each. Advice also covers dealing with unresolved flexible working requests. ARAG Policyholders can register to use the legal services website by using the voucher code shown on their policy documents.

Rachael Wornes

Senior Marketing Executive

ARAG UK welcomes Melanie Pospiech from ARAG, Germany

Moving to England just for a few months is an excellent chance for me to learn more about our different products specially the ATE and get in touch with new colleges and people.

Thank you for this opportunity J

I remember my arrival at Bristol Airport, I was so happy that Lesley and Aleks were so kind to pick me up and took me to my shared house near the company with my two big bags. Hannah has selected it for me and I think she did a great job. It is a house with atmosphere and I am welcomed by my housemates (but have a look yourself).

At my first weekend I got a very good first impression of my colleagues and Bristol. They got together to say goodbye to TOM, it was a funny evening with the “Kangaroo man” as I call him now.

And never forget the amazing food festival and the big waterslide on Park Street combined with this fantastic weather full of sunshine. Because now the weather is – what we Germans say – typical English with a lot of rain. I try to get used to it, but I'm not there yet. But to the English breakfast I got already used to…tasty!!!

What will European Court judgment cost your business?

A European Court of Justice (ECJ) judgment last week could have huge finance repercussions for UK businesses. The judgment in the case of Lock v British Gas rules that holiday pay for those employees who work on commission should include the commission that would have normally received had they been working. 

This means that employers across all sectors may have to review their holiday pay practices and if necessary change the way they pay their staff. The judgment is also likely to apply to other kinds of variable pay including things like allowances and bonuses.

In a worst case scenario an employee may be able to claim back the variable pay they lost when taking holiday back as far as 1998 (or possibly 1993 for public-sector employers). The UK courts and tribunals have not yet decided whether a shorter statutory limit could be applied.

John Lewis has only this week announced its intention to pay out £40 million to 69,000 John Lewis and Waitrose staff after realising they had miscalculated holiday pay for staff who worked Sundays and Bank Holidays for at least the last seven years.

This only serves to highlight the difficulties of correctly interpreting the Working Time Regulations, particularly in the area of holiday pay. If you are an ARAG policyholder you can get legal advice on this matter by calling the helpline number on your policy document. We will also provide representation relating to contractual or statutory matters.

Rachael Wornes

Senior Marketing Executive