Leading legal expenses insurer sets up an ABS
SRA: prior approval needed before ABS can expand services
Well-known legal expenses insurer ULR Additions has won approval to set up an alternative business structure (ABS).
However, the license from the Solicitors Regulation Authority restricts the work LEI Legal Services Ltd can undertake to that outlined in ULR’s application: small-claims damage-only recovery.
It cannot expand into personal injury or any other legal work without the prior approval of the SRA.
A further condition prohibits any legal work, reserved or otherwise, from being referred from LEI Legal Services to Motorplus Limited (which uses ULR as its trading name).
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ULR chief executive Rob Kay said the aim of the application was to ensure the Norwich-based company could continue to handle small-scale work in-house following changes last year to the provisions on in-house lawyers in the SRA Handbook.
The ABS would also provide the legal advice helpline the company runs.
Though not formed with the possible increase in the personal injury small claims limit in mind, Mr Kay said ABS status “protects us” from regulatory change.
“It does give us business options,” he said. “It’s not all about making money but trying to offer a quality, flexible service.” Handling legal work is not “a major profit-making concern”, he added.
ULR also provides add-on insurance products and first notification of loss services. Its most recent results (for 2011) showed a £2.7m pre-tax profit, with turnover nearly doubling to £30.8m and sales of insurance policies increasing by 77% to over 3.3m. The company handled over 130,000 claims in 2011 compared to 63,554 in 2010.
The company employs over 150 staff and offers a range of 28 insurance products and services. It operates its own 24-hour claims management call centre from two sites in Norwich and works with over 160 UK insurance brokers, including six of the top 10 UK brokers and 18 ‘top 50’ brokers.
Last year ULR was at the centre of a major case about the rates legal expenses insurers pay non-panel solicitors, with the Court of Appeal ruling in its favour.
Tags: ABS, Alternative business structures, legal expenses insurance
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