Leading legal expenses insurer DAS broadly welcomes the Competition Commission provisional findings on the private motor market but urges caution on how it now progresses.
Richard Harris, head of claims at DAS UK Group, said: “We have read the Competition Commission investigation with interest and intend to submit responses to some of the remedies that are proposed within it. The overarching theme of our responses will be that access to justice is not compromised in the pursuit of reducing premiums.
“We acknowledge that the commission has put the customer at the heart of its proposals and we would seek assurance that there are no unintended consequences as a result of the remedies.
“The law is in place to protect individuals and the industry must be careful to ensure these rights for individuals are not compromised in an attempt to lower motor premiums across the market as a whole. These premiums are influenced by many other factors that are well within the control of general insurers.
“We particularly welcome the Competition Commission proposals to increase the awareness of consumer’s legal rights following an accident. These proposals complement the findings of the Financial Conduct Authority in its thematic review of motor legal expenses insurance (MLEI) – particularly the need to increase customer understanding of the product.
“DAS has already undertaken a significant amount of work to improve how we highlight this to our customers in our literature and processes and we will continue to work on improving this understanding.”
For add-ons, DAS wants much greater transparency of the value for money these products can offer customers.
Richard Harris added: “Policyholders should be able to compare and understand on what basis those add-ons, especially motor legal expenses, operate. Whilst the basic features of MLEI are common to most products, individual policies can differ greatly.
“An example is the inclusion in some policies of damaged-based agreements (DBAs) that can see customers surrender up to 25% of any damages they receive after being injured in a non-fault accident.”