ARAG Legal Services & GDPR

We have had a number of queries about GDPR and what help is available to Policyholders on our Legal Services website. The team behind the website has been busy working on changes and enhancements to ensure that the service we provide to customers is GDPR compliant. While some changes are already in place others will go live from the 22nd of May.

Changes to legal content – documents and law guide

Business Legal Services

Employment

• We’ve updated the employment contracts so they’re compliant with the GDPR and – when it comes into effect – the new Data Protection Act.

• All supporting recruitment documents have been reviewed to help employers fulfil their data protection obligations when receiving personal information from job applicants.

• The Employee handbook now features a detailed Data Protection policy, outlining a business’s data protection responsibilities and how their staff should help ensure they’re met.

• There is also a new Privacy notice for employers to give to existing and prospective staff, ensuring they’re given the requisite information about what personal data of theirs the employer holds.

Updated documents: Consultancy agreement, Criminal convictions declaration form for job applicants, Employee handbook, Employment agreement, Employment statement, Executive director’s service agreement, Fixed-term employment agreement, General purpose reference request letter, General purpose rejection letter, Interview checklist, Job application form, Job description, Job offer letter, Licence for an employee to occupy residential accommodation, Licence to occupy business premises, New employee induction checklist, Service occupancy agreement (Scotland), Zero-hours agreement

E-commerce

The Privacy and cookie policy for a website has been overhauled, giving users the opportunity to fully outline what categories of information they capture via their website, what they do with it and their reasons behind it. To be more in keeping with the GDPR terminology, we’ve renamed the document Privacy and cookie notice for a website. However, its purpose remains the same.

The related website terms and conditions documents have also been updated with the GDPR in mind.

Landlords Legal Services

Both commercial and private residential landlords fall under the scope of the GDPR. They will need to give their tenants information about the personal data they hold and what they’ll do with it. A new privacy notice for landlords has been created to fulfil this purpose, and we’ve added guidance to the documents listed below to help landlords understand their obligations.

Updated documents: Agreement for a landlord to share a house/flat, Agreement to let a room to a lodger on a serviced basis, Assured shorthold tenancy agreement, Letter from landlord confirming status of tenant, Medium term lease of commercial premises with rent review, Private residential tenancy agreement (Scotland), Residential tenancy agreement (Northern Ireland), Short term lease of commercial premises with no rent review

Law guides

GDPR-related information is being added to the following law guides:

Ecommerce, Employment, Landlords, Property, Purchase & Sales, Workplace

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Changes to websites and operational procedures

Consent for use of data

The data we process in order to fulfil our service is almost all provided to us under the GDPR lawful basis of ‘Contract’, meaning that the data that customers provide is necessary in order for us to fulfil our obligations to them. However, when customers register to use a website for the first time, we ask them to provide specific ‘consent’ to use their data for some purposes. For Business customers This is to receive a business bulletin. As we cannot presume any previously supplied consent is still valid this must be reset and collected again. 

We have amended our registration form to capture consent in a more granular way, as required under the GDPR, and to tell customers how they can update their preferences. We have also updated the summary privacy notice included on the registration form:

Going forward, all existing consent responses will be reset to ‘No’ in our databases, and customers will be prompted to opt in again when they next visit the site. 

Timestamps for consent collection

As required by the GDPR, at all points where consent is collected electronically, this will be timestamped and versioned, so that there is an exact record of what a client consented to and when this took place. 

Data Protection Policies

All data protection/privacy policies that our website supplier maintains or controls will be updated to better explain who the data controller is and to adopt a friendlier format, with a hyperlinked list of sections at the start of the document. Links to the Data Protection Policy will also be displayed more prominently on the website as part of the registration process.

Terms of use

All website terms of use will be updated to show GDPR data, including reference to the Data Protection policy.

We hope Policyholders find all of these changes helpful and that they feel supported in meeting the new GDPR obligations.  

(Details of GDPR updates described in this Blog have been supplied by the team behind our legal services website). 

Here today, gone tomorrow

Following last month’s news of the collapse of CBL Insurance and the subsequent failure of Denmark’s Alpha Insurance, Head of Sales Andy Talbot, considers where the next legal expenses underwriting failure may occur.

In 2016, it was AU Insurance Services. Last summer, it was Elite Insurance Company. Already in 2018, New Zealand’s CBL Insurance Limited has collapsed leaving Alpha Insurance A/S in solvent liquidation and run-off.

Often, it seems, these failures impacting the legal expenses sector get associated with the ATE market, somehow remote from the majority of brokers. But most legal expenses underwriters, wherever they are based, will have feet in both ATE and BTE camps.

Alpha is a case in point, having underwritten numerous motor legal protection and other policies for brokers around the country, as well as some ATE business.

The precise causes and circumstances of these failures (and the several others that have occurred in between them) may be very different, but they have all left brokers, other intermediaries and their clients in the lurch.

In most cases, clients are unlikely to be impacted if a change of underwriter is forced on their insurance provider. Some consolation for brokers who have to go back to the market, find a new underwriter or product and undertake all the subsequent work that such failures inevitably trigger. 

What is troubling is the frequency with which such failures seem to be occurring.

The legal expenses insurance market has not been an easy one in recent years. Increased regulation, LASPO, numerous other legislative changes and even the succession of IPT rate increases have all put pressure on smaller LEI providers.

Some underwriters have also been more vulnerable to the impact of continued uncertainty over EEA passporting rules, resulting from the Brexit vote, and there are likely to be more legislative changes to come. Proposals to change the way “whiplash” claims are handled and raise small claims court limits could seriously undermine the business models of some LEI providers and trouble their underwriters.

Brokers have good reason to be cautious. Alpha Insurance is only the latest underwriter to exit the legal expenses market. It is highly unlikely to be the last.

How and when the next legal expenses underwriter will leave the market is inevitably hard to predict, but brokers owe it to themselves at least, to minimise the risk of finding themselves in a similar situation over the coming months.

Very few law firms will have the knowledge of insurance markets that most brokers do, so it may be hard for them to understand and calculate the risk. Brokers, on the other hand, should be much more adept at asking the right sort of questions, not just of their immediate provider but the ultimate underwriter too.

Who is this policy underwritten by? Where are they based? Who regulates them and what sort of scrutiny do they come under? Are they independently rated by a credible agency? How much experience do they have writing this sort of business?

Thankfully, it seems that Alpha’s departure and run-off will, like Elite’s before it, be orderly. The underwriter appears solvent and seems capable of meeting its obligations.

Next time, we may not be so lucky.

Underwriting Service Awards - accentuate the positive… but scrutinise the negative

It’s nice to win awards, especially when they’re the result of a market survey, but the feedback we get from such sources is always much more valuable than the accolades themselves.

We were really chuffed to pick up two Underwriting Service Awards towards the end of last year, for the Legal Expenses Team of the Year and Managing General Agents Team of the Year. You might think we take such gongs for granted, having collected a total of nine different prizes in the seven years that these awards have been running, but the voting process in the legal expenses category offers a rare chance to hear what brokers really think about ARAG.

Awards ceremonies can be fun. Even if you don’t come home with a prize, they offer the opportunity to catch up with friends from around the industry and even let your hair down a little. However, even winners can get some very clear, honest and valuable feedback from the market, if they take the time to look at the data and anonymous comments.

Digging deeper though, the anonymous comments from voting brokers offer some very genuine insight that is not easy to gain elsewhere.

First, it is gratifying that positive comments outnumbered the few negative ones by about 4 to 1, and that words like ‘service’, ‘flexibility’ and ‘relationship’ are cited time and again. But it is the few “weaknesses” to which we pay the most attention. Whether they appear to be minor niggles, requests to fill gaps in our product line-up or pointers about particular service areas, we know these are the things we need to work on, to maintain our reputation and stay at the very front of the market.

Awards surveys can only offer a snapshot, of course, and are far from our only source of feedback about the quality of our service. We have recently started the journey to Service Mark accreditation with the Institute of Customer Service, which will give us a broader, more rigorous and continual measure of  service quality, than we have ever had, but feedback in all its forms is vital.

Getting Data Privacy Right

“Data protection… didn’t we just do that?”

Facebook founder Mark Zuckerberg was still in high school, two Stanford PhD students were in the process of founding Google and none of us had even heard of WiFi, let alone cloud computing, when the UK passed it’s most recent Data Protection Act.

So, it’s fair to say the legislation could do with a tune-up. The General Data Protection Regulation (GDPR) will supersede our 1998 Act and similar legislation in every other EU member state, and has been built to unify legislation and strengthen data protection for individuals throughout the EU.

What’s new?
There are new rights for data subjects; new responsibilities for businesses; a new principle: accountability; and much tougher penalties including compensation for data subjects and fines of up to €20 million (more for the very largest companies).

What do brokers need to know?
Far too much to cover here, but BIBA has produced extensive guidance, available online.

What about law firms?
Similarly, solicitors have a lot to be aware of, but the Law Society has created some excellent resources for the profession.

But, but… Brexit?
GDPR will be enforced in the UK regardless of Brexit. It is also expected that its requirements will continue here, whatever the terms of any Brexit deal.

How long have we got?
About 6 months. GDPR compliance must be achieved by May 25, 2018. That may still seem a way off , but we all know how long systems work can take.

Employment Tribunal fees will be scrapped

UNISON have won their Supreme Court challenge against the imposition of Employment Tribunal Fees. The Supreme Court website is about a week out of date and at the time of writing the full judgment is not listed however UNISON has issued a press release.

The introduction of fees, four years ago, is one factor that has contributed to rising claims costs for legal expenses insurers; however the potential costs savings to be realised following the scrapping of fees will be tempered by a potential increase in the volume of claims. UNISON’s victory will not be welcomed by businesses whose vulnerability to be claimed against will return.

We don’t yet know whether fees will be refunded automatically or whether, in the future, it will be possible to charge a lower fee.

UNISON makes a valid point when it says, “We’ll never know how many people missed out because they couldn’t afford the expense of fees. But at last this tax on justice has been lifted.”

ARAG policyholders will not be in the unknown pool of individuals who were deterred from pursing their employment dispute as their decision to take out Family Legal Solutions has given them protection against the unfair fees. Business policyholders who settle fees or are ordered to pay them have also been covered.     

ACAS’s 2016-17 report shows that around 1800 requests for early conciliation are received each week on average. Just below 50% of cases settle through ACAS early mediation and avoid being escalated to a hearing. ARAG policyholders have the reassurance of legal representation throughout early conciliation and beyond.

In relation to employment disputes, the fees have enabled the Government to save around one-third of the costs needed to run employment tribunals. Since introducing fees for employment claims other tribunal jurisdictions have introduced a fee system. For example, low fees of £100 for an application/ £200 for a hearing are payable for claimants seeking dispute resolution through the Property Chamber of the First Tier Tribunal. This level of fee seems much fairer and it’s possible the employment tribunals could adopt something similar.

Aside from charging fees in tribunals, did you know that last year HM Courts & Tribunal Services turned a profit of £100m through the imposition of “enhanced court fees”?  Enhanced court fees apply where court fees are set at a level that exceeds the state’s cost of running a case. This in effect turns courts into profit centres.  We deal with a number of landlord repossession claims and the last hike in fees increased court fees for landlords by 20%.  As tribunal fees have been judged to be unfair surely these enhanced fees are also unfair? 

ARAG’s vision is that all citizens should be able to afford to assert their legal rights and we exist to protect consumers, landlords and businesses against incurring heavy expenses to make or defend a claim. While the abolition of employment tribunal fees is welcome news for employees we will keep a close eye on the impact the decision might have on our business policyholders and we remain concerned at the high cost of bringing other types of claim. 

Unrepresented struggle with employment tribunals

I was surprised by the harsh line taken by the employment tribunal and employment appeal tribunal in a case summary prepared by James English of Hempson’s Solicitors and circulated by barrister Daniel Barnett in his excellent employment law bulletin.

The Claimant brought several claims, including constructive dismissal, against his former employer.

Perhaps he didn’t have legal expenses insurance because he initially contacted ACAS for Early Conciliation without any legal representation.  The claimant named a director of the business as the party he wished to make his claim against (the Respondent). It seems that in this case matters could not be resolved through ACAS Early Conciliation and the claimant instructed solicitors to prepare his Claim Form to pursue the matter at tribunal.

The solicitors correctly named the claimant’s ex-employer, 'SNA Transport Limited' as Respondent.  The employment tribunal rejected his claim as the Respondent had not been correctly identified on the Early Conciliation Certificate. His solicitors applied to the tribunal to reconsider that decision on the basis that the use of the director's name was a "minor error", which (under the rules) allows a tribunal to overlook it.

The employment tribunal rejected that application taking the view that confusing the director with the company was not a minor error, and it had been right to reject the claim. The Claimant appealed.

The Employment Appeal Tribunal, although sympathetic, rejected the Claimant's application. It said that a two stage test should be applied. Firstly, was it a minor error? If not, the claim would be rejected. Secondly, if it was, the tribunal should go on to consider whether or not it was in the interests of justice to allow the claim to proceed. Although in principle the distinction between a natural and a legal person could amount to a minor error, in this case it did not. Each case should be considered on its facts, and as there was no error in the tribunal's Judgment, the Claimant's appeal was dismissed.

I’m disappointed about this decision as it’s an easy mistake for someone who is acting without legal representation to make. The case does however underpin the value of legal expenses insurance for ACAS Early Conciliation.  Although the system was designed with the intention that employees should negotiate without legal assistance it is not free of obstacles. If this claimant had taken out LEI, the error in completing the ACAS form would have been avoided, allowing him to pursue his action at tribunal. Additionally, the insurance would have covered the Tribunal fees and legal costs incurred.

Tailored cover gives competitive edge

The demographics underlying the continuing growth of care providers are becoming so familiar that many brokers are in active competition for this business. ARAG has just introduced Care Provider Legal Solutions*, an expertly designed product to give specialist brokers the edge over conventional commercial legal expenses policies. The new product has been built around ARAG’s own claims experience over the past decade and extensive consultation with specialist agents.

Care providers come in all shapes and sizes and any of them can be subject to rigorous investigation. The new policy acknowledges this, whether assistance is given on a residential or nursing home basis, or through other registered premises including where cared-for individuals live in their own homes.

ARAG can now offer representation for care providers at coroners’ courts or fatal accident inquiries, Quality Care Commission investigations and registration disputes, Charity Commissioner appeals (plus Scottish and NI equivalents), and even 24/7 in the case of interviews under caution. Additional legal defence is available for allegations of dishonesty or violent acts. All this on top of what might be expected under the ARAG Essential Business Legal policy.

A further benefit recognises that care providers can suffer significant long-term damage to their reputation, so the crisis communications aspect of cover has been substantially increased, to £25,000.
The background to this burgeoning market is that the greater part of 10 million people aged 65+ have a long-term illness that affects their activities. Of the 1.3 million aged over 85, more than 70% have a long-term illness. During the past 25 years, the number of people in this latter category has doubled, and is expected to more than double again to 3.1 million in a similar time frame. Around a million older people and those with disabilities already live in care homes or have care provided in their own homes.

* Care Provider Legal Solutions is available under delegated authority arrangements. Where LEI is bundled as a mandatory cover the wider features may be given under the Absolute Business Legal policy.