James Liddiard: The Innovation Group

After cracking international expansion, insurance software company the Innovation Group is breaking into claims processing. Joanne Harris reports

When James Liddiard first walked through the door of the Innovation Group (TiG) in July 2001, he was a corporate assistant on secondment from DLA (now DLA Piper Rudnick Gray Cary). He thought he was on a six-month stint at one of the firm’s clients.

Three and a half years later, Liddiard is the sole lawyer at TiG’s UK headquarters, in charge of the company’s legal work across the globe.

TiG was founded in 1997, and has grown swiftly through acquisitions. It floated on the London Stock Exchange in 2000, and is now present in Australia, Canada, Germany, Japan, South Africa and the US. South Africa is one of its key jurisdictions, and TiG maintains a legal presence there with a South African lawyer to deal with local matters. For everything else, everywhere else, Liddiard is the only in-house contact. This means he coordinates work across the world, gaining experience in many jurisdictions along the way.

The company’s business is software, but it deals exclusively with insurance firms. One arm, the technological solutions division, designs and creates software specifically for insurers. The other, the Specialised Business Process Outsourcing (SBPO) arm, processes claims on behalf of insurers, using the technology TiG creates.

Owing to the nature of TiG’s business, around 80 per cent of Liddiard’s work is concerned with drafting IT contracts. This was a big change from his training as a corporate solicitor, and he admits that initially he had very little knowledge of the business. “Mainly I was learning as I went along,” he says. “I thought it was a real challenge, but it’s been a pretty smooth ride.”
That ride has been helped by the close association Liddiard has with Mark Taylor, the DLA Piper partner responsible for the TiG work. Now that Liddiard’s expertise has shifted away from corporate work, he relies on Taylor’s advice for corporate matters.

DLA Piper has been acting for TiG since winning a beauty parade to advise on the company’s initial public offering in 2000. It remains Liddiard’s principal port of call in the UK. The firm’s advice extends beyond corporate work to any employment matters Liddiard cannot deal with himself – although in contrast to corporate deals, which are handled out of London, it is DLA’s Leeds office that deals with TiG’s employment issues.

Liddiard still looks after most of the legal work himself. “I’m dealing with employment issues, litigation, general commercial contracts, day-to-day business things. I’ve even managed things like gardeners,” he says.

Internally, Liddiard reports to managing director Steve Scott. Scott is not a lawyer but prior to Liddiard’s arrival he supervised all TiG’s legal work. He retains overall control of the firms the company instructs. Overseas these include Clayton Utz in Australia, Canada’s Torys, and in the past Kirkland & Ellis in the US. With the recent development of DLA’s merger with Piper Rudnick Gray Cary, Liddiard and Scott are currently considering whether to use DLA Piper in the US.

During 2004, Liddiard was kept busy working on a range of deals in both of TiG’s arms. Most recently, the company agreed an outsourcing partnership with US company NetSol Technologies. Through the arrangement, a new business called TiG-NetSol provides support services for TiG in Pakistan. TiG owns 49.5 per cent of the new company, with NetSol in control of the rest. Liddiard says that the company outsources in Pakistan because the region “has a very beneficial and favourable foreign currency moratorium”.
As for most of TiG’s deals, Liddiard carries out the legal work himself. He has arranged and drafted new contracts for existing technology services client Norwich Union and new client the RAC. Endsleigh Insurance is one example of a new client in the SBPO division, which operates under the name Motorcare.

Motorcare operates from the same building as TiG, near Southampton. An automated telephone system answers calls from insurance policyholders. “Our software will then put through the call and tell the operator how to process the claim. The claim will be deployed to a network of representatives, which is managed by us. Then the insurer will settle the claim. The fact we have that as well as being able to provide the software makes us unique.”

Because of the unusual nature of its work, TiG will escape the same weight of regulation that affects more mainstream insurance companies, which since 14 January have come under the thumb of the Financial Services Authority (FSA). Liddiard says the SBPO side of the company will be most affected, and that the FSA has already passed down a few regulatory points. This will be another area for him to watch.

So does Liddiard express the same contentment as the majority of corporate lawyers who have moved in-house? “It’s the best move that I’ve made,” he says. “It’s a young, dynamic company where I can be very close to the business. We’re positioning ourselves to be able to take advantage of the upturn in the market. We’d like to think that we’re at the forefront of innovation.”

Wherever TiG goes in the next few years, it is certain that its single lawyer will be leading the way.
James Liddiard
Head of legal
The Innovation Group

Organisation The Innovation Group
Sector Insurance, software
Turnover £58.1m globally
Employees 1,100 globally
Legal capability One
Legal spend £600,000 globally
Head of legal James Liddiard
Reporting to Managing director Steve Scott; financial director Paul Smolinski; chief executive Hassan Sadiq
Main law firms DLA Piper Rudnick Gray Cary