Legal expenses insurance

Tam0207

Hi

I would be interested to hear aid you have had a claim on your legal expenses insurance on a claim which you are confined is valid.f

I have recently had problems with the AA and MSL and have written to the FCA as they are currently carrying out a review of the general insurance add on market.

I believe that the insurers and solicitors they use work together against best interests of the policyholder/client and there there is a significant conflict of interest.

I also feel that people do to comparing because they are intimidated by the lawyers believing that they know what these talking about.

In my experience they do not. I work in compliance and spent several years at the FOS.

I have recently checked the amount of complaints about think issue and they do not seem excessive but I do believe there is a bigger issue and people have it used their right to complaint as they do not believe they have a complaint.

If you have been affected, I would urge you to write to the. If they get enough info they may start to look into this issue.

Sine they took over from the FSA they have new powers to act against firms and if there is a big issue a super complaint could be put to them from a large consumer group.

I may be wrong, perhaps I expect too much of firms but i do not believe that my situation is unique and there'd is a by big issue out there.

This could be the new home serve, card guard or PPI.

Martyn Lewis if you are reading and interest in tracking this up I would be happy to tell you all about my experience and let you have a copy of my complaint letters and information to the FCA.

Thanks for reading.



NB apologies for any typos I am using my sons ipad and I am one used to the keyboard.:)

Tam0207

Thanks for your response, I know what the insurance is designed to do ie fund a solicitor to bring a claim.

I think the point I was trying to make is that the insurance does not do this.

The majority of claims are turned down at outset and claims that are passed to a solicitor fail as they do not meet the 51% prospects of success criteria which is an arbitrary figure and can not be based on anything but subjective criteria.

BertTheRaccoon

I have worked in the RTA Claims sector for over 15 years and the bottom line is that Before The Event legal expenses insurance on motor policies has always been a sham.

The policies are never actually claimed against. They have merely been used as a claims capture mechanism so that "customers" with such policies can be pushed onto lawyers that the Legal Expenses Insurer or cover holder has an arrangement with for payment of referral fees.

If your case looks moody they won't touch you as they don't want the lawyer coming back asking for any costs or disbursements. I have been involved in tenders for work as a panel solicitor and it has been made clear that you will not claim against the policy.

The policies are generally made available to brokers for about 50p per policy by the underwriter and are knocked out the door for as much as £35 a hit to the punter. The reason they are only 50p to the broker is that the policy never gets claimed against.

Some on here will argue that a Legal Expenses policy will get you your day in court with a lawyer when you only have a small claims case such as a policy excess claim (arguing that a no win no fee lawyer would not touch such a case - which is largely true) but at the same time most Legal Expenses Policies also have a clause about economic proportionality. This means often they won't cover the fees of a representative at court (because the fees of a barrister or advocate at a small claims hearing are not recoverable even if you win) - so you will be left on your own at a hearing even when you have legal cover.

It will be VERY interesting to see what happens when the toss pots in government raise the personal injury small claims limit to £5k later this year. That would prevent the recoverability of legal costs on personal injury claims upto £5k in value (which is the vast bulk of RTA related injury claims) - meaning either the Legal Expenses insurers for once in their lives will have to pay some lawyer fees, or the policy wordings will be altered more to leave the policyholder on their own at a hearing.

Family Legal Protection policies cover a wider range of risks, but the usual approach from the LEI is that if the claim would involve the customer needing to actually claim their legal costs from the policy, they will try all they can to stiff the policyholder.

Some LEIs are now also buying their own law firm - Ala DAS - you can just see the "independent" legal advice can't you :rotfl: