Insurance outsourcer expects 2012 results to be ‘significantly ahead of market expectations’


Insurance outsourcing firm Quindell Portfolio has been granted a licence to operate as an alternative business structure (ABS) by the Solicitors Regulation Authority (SRA).

ABS licences allow companies other than law firms to provide legal services directly to customers. Quindell’s licence is effective from 21 December.

Quindell believes the licence will present it with growth opportunities. In particular, the company said it welcomed the government’s recent proposal for a new fast-track fixed fees structure for all road traffic accident (RTA) portal claims.

It is proposed that the fixed fees for personal injury cases up to £10,000 submitted through the portal will fall from £1,200 to £500.  When the upper limit of the RTA portal is extended to £25,000, claims between £10,000 and £25,000 will have fixed fees of £800, and when the RTA portal is opened up to employers’ and public liability claims, fixed fees will be £900 for cases up to £10,000 and £1,600 for cases up to £25,000.

Quindell pointed out that the Law Society had described the proposed costs as “woefully inadequate” and complained that many solicitors woudl not be able to carry on doing RTA work.

However, Quindell said it has put in place “significant expansion plans” over the next 12 months to drive the business forward via organic growth, creating more than 300 new positions within Quindell Legal Services.

The company said in a trading update: “Even in light of the most recent government announcement to enter a period of consultation regarding whiplash injuries and raising the small claims track threshold from £1,000 up to £5,000, the board believes that Quindell is uniquely placed to operate post this suggested regulatory change, even at its extremes, and will continue to be able to operate a profitable business model during this period of significant industry consolidation.”

Quindell also revealed in its trading update that it expects results for the year ending 31 December 2012 to be “significantly ahead of market expectations”.

It said earnings per share for the fourth quarter alone will be ahead of expectations despite the number of new shares in issue. The company said this was the result of increasing volumes being transacted by its services division, as pilots have continued to be converted into contracts, and new sales made by its solutions division.

Since its announcement of new contract wins on 3 December 2012, Quindell said it has entered into additional long-term agreements and its pilot volumes, both in regard to current run rates and anticipated volumes, have more than doubled.