How to Set Up a Claims Management Business
The key to forming a claims management company — and getting regulatory approval for it — is in the preparation. How can your prepare perfectly? With the very best claims software.
Now might be a better time than ever to establish a claims management business. In the mis-sold financial products and services category, for instance, it is believed that a large amount of claims will be made for payment protection insurance (PPI) between now and a newly imposed cut-off for claims of August 2019.
Before going ahead and setting up your own claims management business, consider what area of this industry is best suited to you — one where you have the most experience. The other sectors permitted under the Claims Management Regulator, a unit of the Justice Ministry, are personal injury, employment, criminal injuries, industrial injuries and housing disrepair.
Under the law in England and Wales, your new claims management company must be authorised by the regulator before offering services to the public. However, some companies are exempt from this rule. They include insurance firms and brokers, as well as independent financial advisors. Also not requiring authorisation are barristers, solicitors and legal executives.
Make Sure Everything Is in Order
As with anything to do with establishing an enterprise in the UK, it pays to ensure you have all the necessary paperwork and documentation before going ahead with an application. Dealing with the regulator to establish a claims management business can all be wrapped up in just over a month, priming a business to take advantage of the lucrative market. Delays can, of course, be costly, and if everything is not in order with the application, the process may take several months, as the regulator keeps coming back to you looking for additional documentation.
One of the most important aspects of this is the company you are planning to have authorised by the regulator, so it can start trading as a claims management business. If it is a limited company, its records at Companies House, including annual returns and other statutory requirements, must be up to date. If, however, you haven’t yet established a company with Companies House, you will need to fully complete the procedure before applying for authorisation from the claims regulator.
The fee for setting up a claims management company is £2,000 and there is an annual fee that applies, based on a company’s revenue. If the firm is relatively small and not handling much claims business, the annual fee might only be a few hundred pounds. If it’s doing between £75,000 and £88,889 in claims business, however, it will have to pay £800. Up to £1 million and it is 0.900% of turnover, 0.800% between £1 million and £5 million and 0.750% of annual turnover if more than £5 million.
How to Handle Claims in the Most Effective Way? With Claims Software
Assuming everything goes smoothly and you have a new claims management business, it is time to get to work. Clearly, you will want the maximum revenues possible for the least amount of work and expense. Manually handling claims can be fraught with error and extremely time-consuming. Computerising the entire process is the wise way of handling everything.
Using claims software to deal with all the various types of claims helps to ensure that errors do not occur. It also means that as the process is completely automated, companies can handle large amounts of claims with relative ease. Personnel who would otherwise be engaged in the lengthy task of doing it all by hand are instead put to better use. As a result, productivity goes right up while costs and efficiencies come way down. This makes for more competitive and profitable claims management companies.
At Logican, we provide some of the very best claims software — including PPI claims management software — on the market today. We have designed our software with you in mind so that it is not only simple to use, but it also does not require ongoing training. Additionally, it is highly customisable according to each individual company’s operations and requirements.
Thanks to the latest and greatest in claims software, succeeding in the claims business has never been so straightforward.