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Credit hire boom powers law firm profit surge

Newcastle claims business has reported a remarkable 62% increase in profits after opting to stay involved in all parts of the compensation process and benefitting from a boom in the credit hire market.

Winn Group said pre-tax profit for the first half of this year had risen to almost £17m, with turnover jumping 35% to £143m.

Chris Birkett, chief executive, said the company had grown ‘exponentially’ over the last 18 months and emerged from the Covid lockdown stronger than many of its competitors.

One key to the success has been retaining the group’s status as a one-stop shop for people making a claim, which has meant bucking the trend and staying involving in personal injury.

Founder and executive chairman Jeff Winn said the option of stopping PI was ‘tempting’ but had been rejected as part of the wider strategy.

‘We effectively do PI as a service – charges only just cover what we spend,’ he said. ‘We make our money in other areas. A decision was made on the basis of breaking even on PI and pulling in profits from things like credit hire.’

The group now has agreements with 50% of the motor market, up from 25% at the same point last year. Winn said the firm is able to add value by accurately assessing whether an accident is fault or non-fault, allowing insurers to get on with processing claims much faster.

Winn Group has engaged Palladium, a provider of digital transformation and management consulting services, to explore the potential of AI-based technology. Most of the investment is currently going into the credit hire side of the business which is most profitable at present, but there are plans to expand the existing wills and probate offering once that market settles down.

Birkett said the company’s focus is on consolidating and building upon existing business partnerships, but it is also open to acquisition opportunities if there is a good strategic fit. He added: ‘Should an opportunity present itself, for example in the credit hire sector, we would take a serious look at it, but the price has to be right and it will have to deliver scale that we cannot achieve organically in the short-term.’

Credit hire

Business Chamber is the online publication for economic, business and small business news, bringing you selected news on wider economic issues and business events interspersed with SME news stories that usually dont get a look in by mainstream syndicated news outlets.

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