One of the UK’s biggest motor insurers has announced a partnership with two law firms following the ban on referral fees.
Insurance giant Admiral Group has joined forces with Lyons Davidson and Cardiff-based Cordner Lewis to provide services for customers making personal injury claims after motor accidents which were not their fault.
It comes just days after the UK’s fourth biggest motor insurer – Ageas UK – entered into a five-year deal with another South Wales firm NewLaw.
The new companies, which have ABS licences and will be known as Admiral Law and BDE Law, will allow the firm to administer claims for customers in-house, giving them ‘a materially better quality of service,’ Admiral said.
The partnership is the most significant to date in a series of tie-ups between insurers and law firms following the ban on personal injury referral fees, which came in to force on April 1 2013.
Admiral, which earned £18.6m from selling customers’ details to personal injury lawyers in 2012, stood to lose a vast stream of income following the introduction of the ban.
The Solicitors Regulation Authority has imposed a strict set of conditions on the new partnerships to protect customers.
Fareeda Jaleel, founder of FRJ Business and Marketing Solutions, said: ‘Traditional law firms are fearful that they will lose clients because of the ban on client referrals and the creation of ABS’s.
‘But so long as they able to evolve and translate their traditional practices into something more consistent, tactical and targeted, they can succeed in retaining and acquiring more clients to grow their business.
‘It will be interesting to see how forging partnerships with insurers impacts on law firms in the future.’