Vamco aims to ringfence repair monies
by Brian Turner
Story link: Vamco aims to ringfence repair monies
Outsourced motor insurance claims specialist Vamco has pledged to keep every pound destined for its body-shop partners safe behind a legal ring-fence.
The Surrey-based organisation, which has never sought or taken ‘referral fees’ from its networks of repairers, guarantees that monies it receives from insurers for accident damage will go to the hard-pressed body-shops and parts suppliers.
Vamco’s managing director, Tony Rand, says all incoming payments will go straight into a special account operated by his company’s legal arm, Kingsley Law Ltd.
He revealed last month that Vamco was to be the first in the UK’s outsourced claims management sector to operate an in-house law firm, after winning an Alternative Business Structure (ABS) licence from the Solicitors Regulation Authority.
Now Rand admits that the furore surrounding the collapse of Drive Assist persuaded him that the time for even more radical reform was now.
“Everyone in the motor insurance industry knows that changes are needed, and that higher levels of transparency are essential, but I think most people are waiting for the Competition Commission to conclude its investigation,” he said.
“To me though, any company wishing to distance itself from the cowboys and the sharp practices needs to do so now. We simply can’t afford to wait until the autumn of 2014 to see what conclusions are drawn, and what recommendations are made.
“Drive Assist’s collapse, especially the revelation that around 100 body-shops stand to lose £7 million they are owed, makes it clear that we must act now, to drive best practice into our industry, and equally, to drive bad practices out.”
Rand, who has worked in the motor industry for almost 25 years, believes that reform should be led by people and companies who understand the sector, rather than external bodies.
“I am as eager as anyone to see the analysis and recommendations of the Competition Commission, but that is probably 18 months away. If we are to rebuild the motor insurance sector’s image and reputation, we need action now,” he said.
“I think it’s vital that reform is not seen to be imposed from above. We’ve seen what’s happened in the banking sector, when the pressure for change comes from outside, and as a result, the public trust – which has been lost – is not restored.
“We also need to restore trust inside the industry; between insurers, claims management companies, body-shops and even suppliers of parts, because it has been eroded by a relentless focus on margins, and not on customer service.
“We embraced the ABS concept, because we didn’t think the traditional structure of using solicitors’ panels worked well. Now we hope that our guarantee of ring-fenced monies will give body-shops and fleet managers the certainty they need to operate.
“It’s a very challenging environment for us all, which makes it critical that the good people work together, and work harder, to drive up service standards, and to focus on making the industry’s systems and processes both simpler and fairer for everyone.”