The catch is that, in most cases, the insurers will insist on the policy holder using their panel (or "pet") solicitors which means that you are unable to instruct your preferred solicitors. Instead you will have a firm, who undoubtedly you will never have heard of, acting for you and, worse still, will be assigned their latest 16 year old recruit to handle your case. You will never get to meet this individual, who is probably on the south coast or in London and will never be able to sit down opposite them to discuss your case and seek their advice. You are likely to become a very small number in a very large faceless organisation. You will continually be told that they are acting for you in your best interests!

So is this legal? The answer is only to a point and this is the point that invariably the insurers will not tell you about. They are not able to insist on you using their solicitors to pursue your claim from the point where Court proceedings are issued (if this becomes necessary). To do so has been deemed to be anti-competitive and contrary to public policy.

So why does my insurance company try to insist on me using their solicitors? This is because they will have entered into an agreement with their panel solicitors that in the event of your claim not being successful and a bill for their work being submitted to your insurers, that bill will either be significantly reduced or waived altogether in return for panel membership.

And why do the insurance companies provide LEI either as standard or very cheaply? The answer here is to frustrate claims for costs being made under a Conditional fee Agreement (No Win No Fee Agreement) by solicitors. If there is a pre existing policy of insurance such as LEI , solicitors are prohibited from pursing claims on a No Win No Fee basis as this is a more expensive option .All claims for damages (which include the costs) must be kept to a minimum or they will not be recoverable . It follows that if the insurers offer LEI freely or cheaply , more people in the UK will then have LEI cover, so in the event of a subsequent claim , this cannot be pursued on a No Win No Fee basis .The cost overall to the insurance industry as a whole will be significantly reduced .

So what do I do if my insurance company says I have to use their own solicitors? The best thing is for your chosen solicitors to write to your insurance company, registering their interest and your claim and notifying the insurers that, in the event of settlement not being achieved, your solicitors will contact them when Court proceedings are issued. You will be entitled to full costs cover / protection under the terms of your existing policy of insurance with your solicitors continuing to act for you.

At Close Thornton, we frequently come across insurance companies trying to insist upon their panel solicitors being instructed if clients want to have the benefit of their LEI policy. Our way of dealing with this is to try to negotiate with the third party as quickly and efficiently as possible and as soon as we receive confirmation that settlement is not going to be achieved easily , we issue Court proceedings so the client then has the full costs protection allowed to them under their insurance policy and are happy to know that their case will continue to be handled by solicitors with all the necessary expertise to bring about a satisfactory conclusion.

If you would like to discuss this or any other personal injury matter, please contact Shaun Burke at shaun.burke@close-thornton.co.uk or call 01325 466461.

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