The Competition and Markets Authority (CMA) has launched an investigation into will-writing and other legal services in light of concerns about compliance with consumer protection law in unregulated parts of the sector.
The CMA is seeking information about instances where consumers may have been treated unfairly, and is encouraging interested parties such as consumer advocates, professional bodies, trade associations and consumers to get in touch by 4 September 2023.
According to the Legal Services Board, the value of the wills, trusts and probate market was £2bn in 2021 and there are about 208,000 unregulated providers in England and Wales, many of them operating in the will-writing sector.
The laws relating to wills, probate and divorce differ across the nations of the UK. In England and Wales, consumers have alternatives to conventional high street law firms, especially for services where the adviser does not need to be a solicitor. In Scotland, certain legal services are restricted to professionals authorised to carry out those services based on the qualification they hold and are subject to statutory regulation; similarly in Northern Ireland, certain legal services are restricted to qualified persons such as solicitors.
Alternative providers very often offer services that can be cheaper or more convenient – but where they are unregulated, the CMA says it is important that normal consumer protection laws are complied with and, if necessary, enforced.
Sarah Cardell, Chief Executive of the CMA, said: “These services are essential to people, often at the most challenging times in their lives. The CMA is aware that rising living costs mean people are watching their spending, so shopping around for a more affordable option is attractive and sometimes a necessity.
“These may not be frequent purchases, but they are life-changing. That’s why it’s so important that we investigate so that people can select the right legal service for them – for divorce or probate or will-writing – with confidence. It’s essential that firms get the basics right, including complying with general consumer law which applies to all traders. Customers must get a fair deal.”
Initial research by the CMA has identified three main areas of concern involving potential risk to customers and possible breaches of consumer protection law:
Anyone can legally write a will and, although many are drafted by regulated lawyers, will-writing itself is not a regulated service. Concerns include that consumers may be misled by advertising which offers an extremely low initial fee for advice but does not indicate that final costs can increase significantly. There are also concerns about the use of potentially unfair contract terms, as well as pressure selling and coercion of vulnerable customers.
Pre-paid probate plans
This is a new development in the market in which customers pay set fees upfront for probate (the legal process of managing someone’s estate when they die). They do so in the hope that, following their death, their families will not be required to pay anything else. The CMA is concerned about pressure-selling techniques being used on elderly and other vulnerable people; lack of transparency about what costs are covered; plans that are unnecessary or fail to serve their purpose; and lack of customer awareness that their money may not be adequately protected, even if held in trust.
These so-called ‘quickie’ divorce services have grown in popularity since the COVID-19 lockdown. The regulator’s concerns include misleading claims about the process and prices, which can leave customers unclear about what they can be helped with or what they are paying for; and inadequate quality of service, including use of the wrong forms, incorrect details, late filing of papers, and poor communication with customers.
The CMA says it is also concerned that, if a company ceases to operate, there is a risk that customers’ money or important documents, such as their will, may be lost.
Further updates as part of this investigation will be published on the CMA’s Unregulated Legal Services Case Page.