Who pays the price?
27 November 2000
Talking to insurance clients about the service they receive from law firms can elicit some frank, honest - and sometimes downright blunt - responses. And not everything they say is good news for the lawyers.
"We have so many firms, I don't think I could tell you who does what," one client confides. So much for all that money thrown at branding then. Another muses: "Do I think lawyers should be innovative? No, I believe they should do what they're told." So much for all those years of experience too.
In fact, you could get the impression by talking to some clients that no one actually likes or respects their legal team - perish the thought. However, luckily for some that is only part of the picture. The reality is that clients are pretty consistent about what they dislike, but offer a more complex picture when it comes to what they actually want. Why? Because different clients want different things at different times.
There are of course innumerable things that insurance clients dislike about lawyers. Top of the list, of course, is the amount of money they charge and how they go about charging it.
No doubt some readers will be yawning at this point. After all, lawyers being thought of as too expensive is hardly front page news these days. But with many insurance firms' client bases being eroded - or is that erased? - lawyers would do well to sit up and take notice. The law is a service industry and clients, as everywhere, expect value for money. And unfortunately for some firms, they have the muscle to demand it.
"All firms overcharge horribly," probably sums up the consensus. But clients - unlike some lawyers - do understand the trade-off between cost and service: "I'm prepared to pay for quality work in a short response time," says one. "Prompt and timely communication is vital."
So it is a trade-off. The perception that the downward pressure on fees equates to a desire to get something for next to nothing simply does not hold water. One insurance client says: "We always negotiate the fee and we want to see a budget. I don't mean that we'll go for the cheapest option, we just want to make sure we're getting the A team and not the B or the C team. We realise we have to pay for that - we want quality and we realise that it comes with a price."
The fact is that complaints about money are never actually about money: they are complaints about either service or attitude. Frankly, opaque and inflexible billing practices suggest nothing more to the client than a firm which does not operate in or understand the commercial realities of the world in which the client does their business. It does not exactly inspire confidence. One insurance client says: "I will not instruct firms that say, 'Here are our fees, and we're not going to negotiate'. I want a firm to be competitive."
No one minds paying for quality, but no one likes paying for superfluous overheads. "We're not looking for the firms which will do it for the cheapest fee, but we do want value," says one client. "As for all the expensive receptions and the deep shag pile, they can operate from a shed so long as they do a good job."
In fact, being overcharged for poor service really sums up all client complaints. Which is a shame, because when a firm gets the total service offering right it must translate directly to the bottom line.
One client says about Clyde & Co: "It makes the best effort to ensure that its people know of other people in the firm who could help you out in other areas. They know what sectors you may need help in and the people in the firm who can help you. The internal communications are very good. It also has a respectable presence in the marketplace and its publications are of a high standard as well."
In terms of law firm marketing, Clyde & Co wins top billing. It is clearly getting the balance between networking and information-sharing just right. And as one of its clients was honest enough to admit: "Sometimes marketing can be a good thing. A lot of clients are lazy and don't find out about things."
So what do clients like? First, lawyers who remember who is paying whom and that understand the subtleties of the client's business. "We need lawyers who work as a team and understand client needs and requirements. The arrogant ones tend to see the case as a personal thing and not think that much about the client," says one.
Second, they like good service, defined primarily by quick response times, clarity of communication and consistency. It is actually very straightforward. You could even call it a kind of courtesy, although most clients would probably just define it as professionalism. It is what all the star law firms (see box) have in common. To quote one client of his preferred firm: "They are very professional - they make you feel as if you're in control of your case. They are excellent communicators and very good with people."