I noted the items in the Gazette of 7 October relating to referral fees and legal expenses insurance.

There are some insurers with whom it is a pleasure to work. However the behaviour of others does give cause for concern. For example:

  • It is common practice for some insurers to tell their insured that they must use a panel solicitor, even where it is apparent that the legal issue is not covered by the policy. This is a lie;
  • Some insurers insist that non-panel solicitors enter an agreement with them which makes the average commercial lease look like The Dandy. I have seen one (32 pages of close-typed script) where the terms to which I was asked to agree would have placed me in a situation where I would have been in breach of my duty to the client;
  • Some insist that the insured incur an ‘up front’ uninsured cost (such as counsel’s advice) before they will instruct a non-panel solicitor.

The only reason that I can think of for such dubious tactics is to force the client to choose a panel solicitor and secure referral fees for the insurer. Whether you advocate or oppose referral fees (I am opposed), such unsavoury tactics must be addressed by the Legal Services Board.

Howard Shelley, Bilston, West Midlands