Admiral still cashing in on PI referral fees
Admiral, one of the UK’s leading car insurers, last year made £6 on every vehicle it insures through personal injury referral fees.
The company revealed in its financial statement for the 2012 calendar year that it earned £18.6m from selling customers’ details to personal injury lawyers.
The Cardiff-based business appears to have reduced its reliance on referral fees ahead of next month’s ban, with receipts down from £24.5m in 2011.
But the importance of referral fees will lead to speculation that the insurer will seek out a law firm or claims management company with which to form an alternative business structure and get round the ban.
There was no mention of a possible acquisition in the financial statement, with chairman Alastair Lyons (pictured) merely stating that the firm will ‘embrace and profit from change, rather than fear it’.
As well as the £18.6m earned from personal injury referral fees, the firm made £13.6m from credit hire referral fees. The financial statement noted that the Competition Commission has recently started a review of the car insurance market which may result in referral fees being banned.
Overall, Admiral Group increased profit before tax from £299.1m in 2011 to £344.6m in 2012. Turnover, which takes into account revenue from referral fees, was £2.2bn last year, up from £2.19bn in 2011.
UK car insurance delivered a profit of £372.8m - up 19% on 2011's result of £313.6m, primarily driven by higher net premiums.
Comments
More money to bribe the govt
More money to bribe the govt with.
£345,000,000 profit. And
£345,000,000 profit.
And we're the fat cats!?
Why bother reporting this?
Why bother reporting this? Its salt in the wounds.
This whole facade and insurer led witch-hunt has gone totally unnoticed in the publoc domain and the general public still views PI sol's and CMC's with anitipathy and as the supposed reason for driving up premiums.
Insurers have been (and still are) encouraging people to make whiplash claims all the time. It is an industry created by them which was fine as long as it was their preserve.
The only thing these new changes will do is make it their preserve again.
John Hyde
Surely the fact that so much has gone unnoticed in the public domain is the very reason why we need to report this kind of news? Never mind the fact that Admiral is rumoured to be about to enter the legal market very soon.
John, I agree it should be
John, I agree it should be made public, but to be honest publicising it here doesnt cut it - until the mainstream media get involved all we will have here is little more than the death rattle of the PI industry.
Keep up the good work, John
I agree. If I am facing an uncertain future I want to know why and what I can do about it. Knowledge is power.
Campaigns and Access to Justice
As highlighted elsewhere in the context of Graylings accelerated consultation on Criminal Defence there is little point with so many attacks now taking place on the public's access to justice in being "nice" or civilised and the gloves must be taken off by the Law Society.
This information brought to our attention by good journalism is the sort of information which must be fed to the wider media to catch the attention of the public.
We have to establish a new narrative in our comments to the public .There are plenty of issues at the professions disposal and I for one are quite happy to get into a spat with politicans if called upon to do so.
John - keep digging
Knowledge is Power
Whilst I agree, that knowledge is power, the knowledge has not done us much good so far. We've all trained for a huge number of years to have these lovely legal jobs, we're supposed to be intelligent creatures, and none of us saw this coming? Insurers are in bed with the gov't, and we're hung out to dry. But yes John, please keep reporting, especially if you find a glimmer of hope in the mire of doom.
Dear Shafted Others were
Dear Shafted
Others were supposed to see this coming .However solicitors are not natural street fighters.
Public domain
Unfortunately, the Gazette is not a publication which is ready by members of the public - it's read mainly by solicitors. If the Society wants to get its message across to the public, it needs to orchestrate a campaign using media which are seen by the general public. The problem is that many members of the public are rightly disgusted by adverts for CMCs/lawyers who will secure compensation in respect of personal injuries. Such adverts seriously devalue the profession and should never have been permitted. Making good the damage caused by them is probably an impossible task.
The idea that insurers will acquire interests in law firms or establish ABSs is hardly news. Of course they will do that. The battle to retain personal injury work as a viable source of income for a broad range of solicitors has been lost. The next step will be that other forms of civil litigation are lost to the broad community of solicitors, through the selling of BTE policies under which the policyholder's right to choose his own solicitor is not properly observed.
Can John Hyde comment?
John,
I suspect that the mainstream media are largely uninterested in technical stories about lawyers' fees. They see lawyers as being like bankers and drug dealers - greedy and self serving. Any story that does not fill the usual "fat cat" pigeon hole is of little interest. Is this your view?
Scuse me
I am clearly not John Hyde, but I did speak to a friend at the BBC in recent months to see if I could interest him in running a radio programme about some of the issues surrounding developments in PI. He was very keen to hear of instances of sharp practices by insurers, but warned me that sob stories by solicitors were an absolute non starter as the general public are simply not interested. My fear is that even if this was front page news in all the broadsheets public sympathy would not lie with us.We rank right down there with estate agents and traffic wardens.
All I can say is would
All I can say is would someone PLEASE tell all those who continue to call my husband he REALLY WAS NOT INJURED in the motor accident last May
Glad Mr Ron's ok. I had the
Glad Mr Ron's ok. I had the same thing after my crash, endless Liverpool accents (no offence intended) telling me there's £1,600 sat waiting even though I was fine.
That'll be the insurers
That'll be the insurers selling his details to a database then.
Deborah listen up
Someone's paid good money to be told that your husband is injured. He'd better get up to speed (a crippled crawl is best) and start telling everyone about the chronic back pain.
maybe if everyone send their
maybe if everyone send their comments to the Red Tops some may get through for the "man in the street" to see and realsise that not only will he not get all his entitlement, Some Insurers are trying to make it "law" they contact third party insurance NOT a solicitor.
Also when Macaroon and the rest of his entourage get their way and their is no way to appeal to anyone, JV being limited and come out of the European Courts Jurisdiction ...... because we have some undesirable terrorists in the country they have carte blanche to bring in any despot laws, Idi Amin springs to mind.
Fat Boris says it is not up to the Govt to limit earnings, Not if you a Banker, Insurance Company or member of the Bullington Club, but it is perfectly acceptable to decimate other peoples lives and livlihoods
If this happened in America some "lunatic" would have probably got a gun and sorted out the issue, In the UK we too used to being manipulated and deliberately lied to by ALL MP's this is great to deflect away from their "expenses" claims
Good point. I'd not fancy
Good point.
I'd not fancy being in Graylin's shoes. You can't end the careers of tens of thousands for no good reason and expect no-one to use you as target practice. Someone will snap. Where's my popcorn?
How much?
So in a real test we find that the referral fee equates to £6 per policy. Does that mean that depriving the claimant community from advertising access to justice and the choices available, will save the public less than the price of a gallon of fuel, if of course the savings are passed on in full?
An invitation
May I suggest that the Law Society / APIL / MASS / ILEX / AJAG and the bar join forces in order to arrange a day in the very near future where all those to be affected by these changes, not only lawyers (claimant and defendant), but support staff, costs draftsmen, medical agencies, rehab providers, office cleaners, legal marketing companies, and all other peripheral service providers be invited to march on Downing Street in a day of protest. I know for a fact (and quite rightly too) that many insurer claims handlers (and even more so def solicitors) are now also getting worried for their future and starting to realise that without us, they're somewhat redundant too. Bring them along as well. More the merrier. Invite your MP if they're supportive too.
What is needed is to bring this sharply, and urgently, to the attention of the public in an organised and structured way. I'm sure firms up and down the country will have no issue closing the doors for 1 day for the good it might do. All very well debating here, but frankly, it's a waste of time. The public do not read these hallowed pages (other than Kelly Matthews- and she's not invited), and they clearly have no influence, as demonstrated over the last few months compared to where we are now.
I wholeheartedly agree with
I wholeheartedly agree with this above. The time for talking and threads is over. We need unified and emphatic action. Its the only thing that might make the government reconsider its pi steamroll.
data protection?
has anyone considered whether it is even legal for an insurer to sell on and profit from a policyholder's personal information without informed consent? a great deal of money there to be recouped not to mention the sanctions that flow from data protection breaches.
plus i imagine the solicitors/cmcs running the claims hasn't declared their payment to the insurers in their client care etc etc.
Thank you for asking that. I
Thank you for asking that. I was wondering exactly the same thing as I would presume that selling on the details would breach data protection, although no doubt they have hidden something in the small print that no-one reads.
Either way it is the public
Either way it is the public who is always at the receiving end. Be it thee insurers or the government, the only motive they have is to extract what they can get out of anyone irrespective of who suffers. These insurers refer us to injury lawyers who keep pestering us and assuring that we are liable to be get paid in the event of some mishap. And most people fall for it. As far as the government is concerned, they keep banning these activities and slap a penalty on them.Either way its a win-win scenario for them.