Insurer axes in-house in favour of external firms

Legal fee insurer Eastgate Assistance is closing down its in-house legal department and plans instead to hand out litigation work to its panel.

Alex Wise, spokesman for the group, says: "We have made a commercial decision to outsource the work undertaken by this team to our solicitors' panel."

"This is not a wholesale redundancy," he continues. "We are looking to absorb most of the department by redeploying the great majority in growth areas."

Solicitors and other staff will be offered jobs such as legal helpline work and other legal expenses claims work.

The department's main focus has been on uninsured loss recovery work, including work covering the Road Traffic Act. It is this type of litigation work which will now be the domain of the panel.

Wise says the group will not shut down immediately but there will be a year's "running down" period. The department has been headed by John Uting for more than a decade.

The group declines to say which firms are on its solicitors panel. But it has confirms that, unlike many other insurance panels, no cuts have been announced.

Eastgate Assistance is the largest UK provider of legal expenses insurance and helpline services.

It was previously known as Hambro Assistance, before Hambros' acquisition by the Eastgate Group and Canadian loss adjuster Lindsey Morden Group in January.

At the time of the merger, when the group doubled in size, Eastgate's chief executive Ken Randall said: "The additional career opportunities for our staff are self-evident."