Two of the leading names in legal expenses insurance are coming together after ARAG Group agreed a deal to buy DAS UK, including its law firm.
The Germany-based group runs its UK operations via ARAG plc as managing general agent, reporting gross written premium under management of £61m in 2022.
DAS is owned by a German insurer as well, ERGO, and had gross written premiums of £129m last year. DAS also runs its own alternative business structure, DAS Law, and ARAG plc managing director Tony Buss confirmed to Legal Futures that it would retain the law firm.
Both the insurer and law firm are supported by an administrative services company, DAS Services Ltd.
DAS Law largely supports claims and provides advice arising out of the legal expenses insurance.
Its most recent accounts, for 2021, showed a turnover of £14m, up 8.4%, gross margin down from 36% to 32%, and loss after tax increasing from £2.6m to £3.4m. It has around 200 staff, employed by DAS Services.
The acquisition is subject to regulatory approval, until when ARAG and DAS will continue to operate independently without any changes to business and operations. The purchase price is confidential.
Mr Buss said: “We are excited about the opportunities this intended acquisition offers since we are pursuing a long-term strategy, strongly investing in the UK legal expenses insurance segment.
“We intend to offer a ‘best of breed’ portfolio to deliver even broader and better products as well as services to a wider customer base.”
Asked whether the deal would reduce competition in the market for legal expenses insurance, he said: “It’s still a competitive market, just like the general legal sector.”
This is not the first deal between the two. In 2019, ARAG bought DAS UK’s Republic of Ireland operation and in 2021 the ERGO Group’s DAS business in Canada.
DAS brought a private prosecution against its former chief executive, Paul Asplin, and two others that led in 2018 to their conviction and jailing for conspiracy to defraud. The trio also face multi-million-pound confiscation orders.