Scouring the archives

I may have too much time on my hands, but I was looking on the internet yesterday to see what intelligence I could get for the Know you Opponent section of the Credit Hire Forum website. I was partly inspired by the coverage of the Bunting case from DLA Beachcroft and BLM Law which I suspect most people have seen. If not, see the links below:

No sign of the judgment from yet, but we continue to watch before commenting further. However, in terms of my trawl through the internet, I came across an article from 2018 titled ‘Credit Hire: necessary evil or essential service”. It was a roundtable discussion involving:

1. Kirsty McKno, The CHO,

2. Philip Strong, ClaimsFast,

3. Nick Garner, MSL,

4. Shaun Leonard, Allianz,

5. Simon Gallimore, AIG UK

6. Mike King, LV

7. James Roberts, Europcar,

8. Miles Keeble, Europcar,

9. Jackie Britton, QBE

10. Elaine Clark, Markerstudy, and

11. Emma Fuller, DAC Beachcroft.

Quite an unusual mix and not the balanced starting eleven that I would go for if I knew the first thing about picking a football team but, in light of Bunting, I thought it was worth posting the report of the roundtable to highlight how the future of credit hire was viewed in 2018. I have picked out some of the highlights, but the full article is available here:

On the issue of dishonesty by rate witnesses and the convictions for contempt of the Autofocus employees:

The feeling was that it would be in no one’s interest to keep talking about it: “I don’t think the general public even know about it or care about it,” said Simon Gallimore, senior complex casualty claims manager at AIG UK.

“It’s yesterday’s news,” said Nick Garner, CEO at MSL.

I am not sure the evidence of rate experts like Which Rate and Surveyorship is yesterday’s news, especially after Bunting, but court results in the near term will perhaps offer a better prognosis. On the future of the credit hire industry:

“The protocols have definitely changed things, so we are operating in a different space now. New relationships have been built, although some have been destroyed along the way. The challenge is forecasting whether there is a future for credit hire,” added Leonard.

This remains the challenge for the CHO in the face in terms of whether the industry does need to change or is being induced to change to pacify insurers for a more certain outcome. On referral fees:

There was agreement around the table that it would need regulatory action if referral fees were to go and that they couldn’t be targeted in isolation from other issues in the market and without taking into account the business models of CHCs.

“That was an issue with a lot of the suggestions that came out of the CMA,” said Fuller. “You can’t just tackle one issue in isolation. It has to be part of a whole package like the whiplash reforms.”

That last sentence from Ms Fuller says more about the psyche of insurers and defendant solicitors than anything. Regulation remains a core part of the insurer approach to reducing the cost of credit hire claims and the recent changes to the CPR (PD16) demonstrate how that package is being delivered by DAC Beachcroft et al. On duration:

When it came to other suggestions about where to look for ways of reducing the cost of credit hire, the conversation focused on duration and the expectation of like-for-like vehicles. Insurers frequently complain about what they see as excessive repair times and thus extended credit hire period.

This is a genuine problem, but insurers contribute to it, said Mike King, national third-party claims strategy manager for LV. “If you talk about duration and repair management, a CHC that is driving credit repair can be up to 35% less in duration than one that throws it over to an insurance engineer and asks them to authorise it on a third-party basis. They know full well that will take a long time to assess.”

This should be front and centre in every discussion with any journalist or other tribunal criticising credit hire operators and it is an issue currently being adjudicated upon in Northern Ireland. The statement from LV that CHOs offering credit repair services educe hire duration by 35% compared with the comparable claim controlled by insurance engineers is gold dust. On the future of the GTA

McKno said The CHO was considering a GTA kitemark, an idea that was in its early stages of development but would clearly win support from many around the table.

“A kitemark about creating an elite form of credit-hire company where there is better collaboration and more trust” would be a big win for the market, said King.

This and the other discussions around the next iteration of the GTA – a ‘GTA2’ – had at their heart the need to understand that there are better ways to achieve the mobility the customer requires, said McKno.

One idea that did attract support around the table, at least in principle, was the creation of a portal for handling credit hire. Some saw this as a way of modernising some of the GTA processes, which can be cumbersome.

There were some words of caution, especially around the challenge of getting credit firms outside the GTA into a portal. Clark felt that it was a worthy objective but would have to be a government-backed scheme to work. Fuller warned “there is no magic wand” for solving many of the issues discussed. Despite these caveats, the prospect of a portal-style solution combined with other initiatives such as the revision of the GTA and the introduction of a kitemark scheme gave many round the table a feeling of confidence that the future relationship between insurers and credit hire companies would continue to improve.

I am not sure whether anyone’s perception of the competence of the government has improved during the current COVID crisis. Even before that, however, the idea that any evolution of credit hire market should involve the government scares me rigid especially to the extent that it relies on an automated claims portal. My earlier concerns about the recent Verisk and Claimspace arbitration initiative and the prospects of a semi-automated GTA portal may not have been that far-fetched at all.

Enjoy the Bank Holiday weekend.

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