A new aggregator offering legal services - including public injury and road traffic accident options - is poised to launch next week with its boss boasting that Law Superstore could hail a new era of transparency in the sector.
CEO Matthew Briggs (pictured) - who numbers Aviva, Capita and Minster Law, among his former employers - told Postonline: "The insurance industry is certainly more progressive [than the legal one] in that it is willing to be transparent and understands the competitive landscape. It also has a better handle of the benefits of technology. It might not be cutting edge - but it is better.
"The opposite is true of the legal profession. They don't want to be transparent; don't understand how they can benefit from technology; and [in terms of competition] it was described as ‘cartel-like' at a recent event I attended."
Law Superstore, which is backed by the same parent as Winns Solicitors [Winn Holdings Ltd] and shares some common shareholders, has been over two years in development and after a slight delay - it was originally hoping to launch in May - will come to market on 1 August.
And Briggs is optimistic of success, despite some resistance from law firms, especially after the recent Competition and Markets Authority interim report into legal services highlighted the work Law Superstore was doing to help bring innovation to the consumer space.
"The biggest thing for me is this lack of willingness to be transparent," reiterates Briggs. "And this anti-competitive behaviour - and it is anti-competitive - is what the CMA talks about in its report."
Reflecting on how some insurers were lukewarm to aggregators when they started, Briggs adds: "With insurers there was some resistance to comparison sites at the beginning, with people claiming they already had their own brands and routes to market and that price comparison sites would simply introduce a race to the bottom. But look where we are ten years on - they are embedded in society.
"Those same arguments and resistance points are being used by the law firms today. The thing is that there has not been a platform to create any [legal pricing] transparency until now and we have built the [platform] to do that.
"My counter argument when people accuse us of creating a race to the bottom is that [our research] shows that trust is the most important factor - people do not want to buy cheap legal services. They go for the third or fourth name down on insurance aggregators, and the same will be true for legal services. Trust, accuracy, reputation and then cost are the main factors, but price comes fourth."
One of the key reasons Briggs notes no one - including the traditional big four insurance players [Confuse, Compare the Market, Go Compare and Money Supermarket] - has turned its hand to consumer legal services is the complexity.
Art of the Possible
"When we set off on this journey we had no real idea about how we were going to achieve [our aim]. The CTO is the brains behind it in terms of creating the functionality and the art of the possible, because we did not have a clue how we were going to make it a reality. The board's view was just that we should create a legal comparison site. There was no exact brief other than that."
At launch Law Superstore will be able to offer consumers 145 legal services at different complexity levels across 12 main headings from simple wills to commercial litigation, with eight targeting consumers and four businesses.
Depending on how the customer answers questions, the business' algorithms [which have been road tested by a legal team of eight lawyers and four barristers, and include 6000 question sets] decide which path they go down, with Briggs claiming that a user should be able to get to a quote on screen within a minute.
Briggs also notes that customers will be able to filter search answers based on key factors including the nearest law firm, highest rated and/or cheapest based on different pricing options. However, there are over 30 other factors - including whether firms have disabled parking, free parking, are Lexcel accredited, are female-only solicitors and open Saturday mornings - which can also be used to get the most appropriate provider.
Large Untapped Latent Market
One of the biggest carrots for Law Superstore to succeed is the size of its potential audience, with Briggs noting that estimates of the ‘latent market' ranging into the many billions, alongside the known one of £30bn and growing. He added people are often too afraid to seek legal advice, noting only one in five of the 50% of adults who have had legal problem in the last three years instructed a solicitor or barrister.
At launch Law Superstore will have 170 firms on board, a fraction of the 11,000 estimated legal providers in the UK: "It is big community and to be fair we have cherry picked firms, we have not gone to everyone, and we have rejected about 80 because we have a vetting criteria."
Among the major players, Slater & Gordon is already signed up, Briggs is engaged in conversations with Irwin Mitchell, and he would also be delighted to see the insurer-owned alternative business structure get involved.
One of the questions that will no doubt be raised by the insurance community relates to quality of work Law Superstore members will instruct through the site. Like insurance aggregators, Briggs confirms it will monitor behaviours of customers: "With an insurance PCS people might start a journey saying that a car isn't garaged, and then change the answer to get a lower premium. [With Law Superstore the consumer rationale to game the site might be different] but we can see when people are going in and changing answers - and they will get a warning to say we know what they are doing.
"Also one of the qualifying questions is date of incident, and if it is six months within their limitation period we say, sorry we cannot help you. It is all about driving quality."
Based in Newcastle, Law Superstore currently employs 12 developers, 12 legal people and four marketers at its headquarters. However, this mix of staff is likely to change: "We will need less legal [brainpower] when we go live. They will only be needed when we add services, but that will be at a slower rate than [the last two years].
"Where we will need the most people is marketing and technology; that is where the lion's share will be going forward. We have some regional directors looking after the member firms, burning shoe leather on-boarding new firms and looking after the existing ones. But the lion's share will be web developers and marketing."
Law Superstore has costs "millions" to bring to market, and when asked about a timescale to achieve profitability, Briggs comments: "We have a business plan. But I have done a few start-ups and the numbers usually become redundant within a few weeks of trading because all your expectations are blown out of the water.
Go Compare Trajectory
"If it is anything like [Go Compare], I think they lost money in the first two years, broke even in year three and then went crazy; this might follow the same trajectory, but we don't know because nobody has built anything like this before."
To conclude, Briggs said that like its insurance cousins, Law Superstore might do broadcast advertising in time, and that it has already engaged in some "interesting conversations" with potential partners given the white labelling opportunity it can afford them.
Briggs added that now it has built the platform, he has aspirations "to do lot of things" to diversify, although he is adamant insurance is not one of those options.
We are excited to announce that @SFoodbanks and the Sunday morning initiative team will be joining us at this years @WDragonboat ! The team will have their collection van so bring any food donations you can for local foodbanks #HungerDoesntWearClubColours #CharityTuesday pic.twitter.com/UT9Diup11C— Carpenters Group (@CarpentersGroup) August 20, 2019
- Enterprise claims predicted to reach £319m
- Blog: Whaley Bridge throws spotlight on non-damage business interruption cover
- Blog: Breaking the under-reporting habit
- BoE governor Carney warns insurers over climate change
- FSCS to compensate 14,000 Alpha policyholders as deal collapses
- Ex-JLT pair Palmer-Brown and Crossland join SSL Endeavour
- GRP acquires online enterprise risk management firm