AMI Chief Executive Robert Sinclair gives his November update, including AMI’s Protection Viewpoint, market conditions and future challenges for advisers…
The plague on our sector that has been Pure Legal attacking historic Interest Only cases has been stemmed for now. Most of the legal entities in the Pure Legal group have entered administration and the funder of the loans supporting the cases, Novitas, have said they will not be providing further financial support.
These consumers are now up “for auction” to other legal firms via the administrators. However, it should be remembered that all of the cases that have gone to court so far have been won by the brokers representatives. Many cases have been withdrawn before being heard. The six figure sum claims have usually been reduced to low four figure sums during the hearings, but judgements have usually thrown out the cases as “time barred”.
The real losers in this are the hundreds of customer claimants. Sold unsecured credit funding and after the event insurance, they still carry the costs of these cases. Only their solicitors can invoke the insurance, so they are the big losers here.
Firms must not take their eye off this ball. It will be important to remain vigilant. Watch for changing claims or new solicitors acting. If the claim moves to challenging affordability, then that should be the lenders case to defend. Keep talking to your PII providers. Take their advice. We are closer to stepping out of the storm, but there will still be a few months of turbulence.
Robert Sinclair, AMI Chief Executive
AMI, December 2021