The chief executive of one of the largest car insurance companies in the UK has recently rebutted criticism levelled at the insurer regarded the ‘rotten’ fee relationship between car claims lawyers and the insurance industry.
Admiral chief executive, Henry Engelhardt, said the provider of discount car insurance currently had no plans to cease taking kickbacks from law firms or accident management companies. The motor car insurance provider recently revealedthat 52 per cent of its UK carcover profits originated from such kickbacks, most often a process in which the personal details of customers who have filed accident claims are sold to third parties for what is sometimes called a ‘referral fee’ or an ‘acceptance fee.’
The Government condemned such relationships between insurers and lawyers, with justice minister Jonathan Djanogly going so far as to call the entire process ‘rotten.’ Concurring completely with the Government, The Association of British Insurers called for a unilateral banon such referral fees, estimating that consumers in the UK now pay an average of £2.7 million daily to legal professionals through their car insurance rates.
Mr Engelhardt disagreedvehemently, claiming that the blame laid squarely on the shoulders of the Labour government that was responsible for the abolition of legal aid for matters of personal injury law over a decade ago. This, claims Mr Engelhardt, has allowed ‘ambulance-chasing’ legal professionals who work under conditional ‘no win no fee’ agreements to take up the slack from injured parties who lack the financial ability to treat their injuries.
The chief executive also boldly said that if the current Government is so opposed to the role insurers play in the current system, it should go ahead and take steps to criminalize the payment of referral fees. Claiming that the insurance industry is doing nothing that is either immoral nor illegal, Mr Engelhardt declared that he had no compunctions at all of telling his mother what he and his company have been doing – something that is most likely to the chagrin of mothers everywhere.