GE Capital's subsidiary Accident Assistance is the latest company to pull out of the credit hire and credit repair business.

Accident Assistance, which claimed to be a top three player in the credit hire market, blamed its decision on recent court rulings that led to a cut in rates.

Of 111 staff, 80 have been told they will be made redundant before Christmas. The rest will leave after outstanding cases are settled.

The company is honouring its existing commitments to renew and issue legal expenses policies until 31 December.

Accident Assistance managing director David Muir said: "The action taken has been a tough choice in a very tough environment.

"Nevertheless, we are committed to ensuring our exit from the marketplace is managed effectively."

The company claimed its profitability had been cut by recent rulings on the credit hire market, including the Dimond v Lovell case handed down by the House of Lords last year. This applied limits to credit hirers' spot rates and stopped insurers paying high prices.

Accident Assistance is one of a string of companies to be adversely affected.

Motor Law was recently sold off, while credit hire firm Helphire has been involved in legal wrangles with a number of insurers over an alleged £15m debt.

Motoring Uninsured Loss Recoveries Association (MULRA) head David Haynes said these moves signified growing uncertainty for brokers and their clients.

He said credit hire was now being replaced by insured hire, in which the insurer covered all the risk, rather than the customer having to foot the bill.

He advised brokers seeking advice on placing uninsured loss recovery (ULR) business to seek MULRA advice.