The turnaround continues at Minster Law, with a progress report here FYI;
A three-year transformation programme to reshape Minster Law into a ‘contemporary personal injury law firm’ has secured its long-term profitable future and set in motion a new strategy to help insurers respond to Consumer Duty, according to CEO Shirley Woolham.
Announcing a pre-tax profit of £503,000 (2023: loss of £4,749,000), Shirley pointed to turnover growing last year by 15% to £36,681,000 (2023: £31,811,000), despite the significant reduction in income per case following sweeping reforms to the personal injury market.
Shirley said that PI reforms in the last decade brought about a total rethink on proposition, value and selection criteria in legal supply chain partnerships, and now, six years later, the Consumer Duty is doing the same.
“You can’t carry on doing volume PI the same as it ever was, now that income per case has dropped through the floor and the needs of insurers have changed. We realised early that to focus only on the pursuit of volume was not a strategy capable of creating a sustainable business model post reforms. Instead, we had to think like a start-up, challenge everything and find new ways to achieve sustainable growth and more aligned partnerships.
“We have radically reviewed our cost to income ratio, re-engineered our processes, changed our internal structures, introduced new skills and capability and re-thought how we create value for our business partners beyond simply generating non-risk income.”
“In doing so, we’ve created a model for sustainable growth and redefined the nature of strategic partnerships between insurers and claimant law firms. The result is a £5m swing into profit during the past 12 months, and the delivery of £2.5m EBITDA for 23/24 excluding exceptionals in a very tough market.”
Long term sustainability
Shirley said she expected the 2023/24 result to mark the beginning of prolonged period of growth for the firm. “We’ve had a strong start to our new financial year, having already outperformed our Q1 plan and, with further initiatives in the pipeline, I’m confident of improving further on our 23/24 results.”
She noted that Minster has continued to invest in technology and delivering ‘market-first innovation’, including a new low code/no code onboarding platform, that has streamlined customer onboarding and improved the customer experience. There has also been further investment made in greater integration with insurer systems, a multi-channel comms platform and customer self-service through INK, Minster’s proprietary customer claims portal, where customer adoption continues to increase.
“There’s a huge push for greater digitisation in motor claims and we must keep pace with that and be able to complement it. We now have the capability to capture and onboard customers through ENOL, traditional FNOL and self-service routes, supported with a multi-channel engagement model”
OIC analysis allows for deeper partnerships
Shirley explained that Minster’s data analytics capability has also given her team a ‘clear-eyed’ perspective on third-party insurer behaviour and claims tactics in the OIC (Official Injury Claim) portal, which for the last three years has processed RTA whiplash and minor injury claims.
“Our insight and analytics assess patterns in third party insurer activity, how these translate to them meeting their obligations and how each insurer performs against their peers across OIC criteria and claims stages. We know, for example, that the average time taken to provide an initial liability decision has increased by 3 days over the past 12 months, but that this increase is largely driven by the behaviour of just three of the top 20 motor insurers. We know from which insurers we are more likely to see causation being raised at liability stage and we can see those insurers who are being more proactive in their liability and valuation approaches. We use this kind of insight to inform our approach to managing and progressing claims on an insurer-by-insurer basis.
Our own insurer partners also see immense value in the anonymised performance benchmarking we can provide, which is allowing them to pinpoint specific strengths and weaknesses in their own claim operations, and it gives us the means to find new opportunities to drive improvements in claims progression and claims outcomes for customers”
Growth in serious injury
Turning to its serious injury division, Shirley said Minster Law had grown to now become one of the leading RTA serious injury practices in the UK serving the Insurer and broker market, with case volume up by 50% from just two years ago and multi-track headcount reaching 188, out of a total of 508 across the business.
She noted: “Insurers carry significant exposure in serious injury claims and we work collaboratively with our business partners to better manage their indemnity exposure, improve reserving and remove frictional cost from these more complex, high value claims in areas such as pre-issue mediation, escalation discussions, cost schedule agreements and protocols. It’s just another example of the new ways we can bring strategic value to our partnerships.”
Motor insurance task force and supply chain opportunity
Shirley said the path to creating a profitable, contemporary law firm had been ‘immensely challenging,’ but Minster is now ready to work with insurers to determine the future of the supply chain, which is in the spotlight following the Government’s motor task force announcement.
“It’s important that voices from the supply chain are heard as part of the inquiry, but it’s not just about the cost of motor insurance,” she said.
“We are already working with our insurer partners to re-define the role of claimant law firms within the supply chain, to help them realise new ways of creating value from our more contemporary and strategic approach.
“Delivering to the principles of Consumer Duty regulation is just one of those areas of new value contribution, where insurers need and should expect more from their supply chain partners.
“Supply chain partners must have something to offer beyond a ‘claims factory’ approach to managing claims, so we ’ve going at this head on, helping our insurer partners to meet their regulatory obligations and setting a new standard in outcome-focused legal services.”
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