Friday, September 14, 2012

Admiral make £24.5m per annum on referral fees

Admiral, the well known UK insurer recently confirmed it rakes in £24.5 million in fees from solicitors who buy personal injury referrals from their vast accident network. This astonishing sum amounted to 25% of their revenues for 2011.

Now given that referral fees are being banned from April 2013 in the personal injury field, what will become of Admirals hugely profitable referral mechanism..? The answer is that they will no doubt set themselves up as an ABS and develop an offshoot law firm. Rather incongruous circular arrangement when you consider there might be thousands of passengers suing negligent Admiral drivers via their own network at some point in the future. 

The lie that the insurer lobbyists propagate is that they do not fuel the so called "compensation culture" by selling leads en-masse for profit. The fact that Admiral have published such huge figures underlines how crucial PI referrals are to big insurers.

But times will soon be changing and it will be interesting to see how the insurer market reacts.   

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