The will-writing sector is at a crossroads, writes Eddie Goldsmith, senior partner at Goldsmith Williams.
Over the next year important decisions will be made about the future of will writing which will determine if mortgage brokers can continue provide such a service themselves.
Although 88% of people currently use a solicitor to prepare their wills, will writing is not a ‘reserved legal activity’ as defined by the 2007 Legal Services Act, which means that anyone can set up as a will writer, including mortgage brokers.
However, concerns have been expressed about the implications of continuing with the current system. Consumers are potentially exposed to risks if they use non-regulated will writers, as highlighted by the recent BBC Panorama programme ‘The final RIP off?’.
If a solicitor is instructed to write a will, consumers are protected because solicitors are regulated, even when carrying out non-regulated activities. Unfortunately, most consumers are unaware of this important distinction between regulated and non-regulated will writers and this issue is now exercising the minds of the regulators.
On 6th October 2011 the way in which legal services are provided is being extended to include non-legal businesses. The new law has been dubbed ‘Tesco Law’ because it will enable the big supermarket chains, amongst others, to offer a range of legal services, including will writing and conveyancing. The objective is to open up the legal services market to greater competition which, it is believed, will drive down prices and improve the quality of service provided to consumers.
However, there are increasing concerns that some areas of the law, such as will writing, will become prey to cowboys who are simply out to make a quick buck at their clients’ expense and there are now calls to have will writing designated as a reserved legal activity under the Legal Services Act. This would mean that only organisations regulated under the act would be able to draft a will, in the same way that only solicitors and licensed conveyancers can undertake conveyancing. The alternative is for the Ministry of Justice to oversee the activities of will writers, in the same way that it currently oversee the activities of claims management companies.
So what will the regulators do? The Legal Services Board is currently investigating if a different regulatory approach to will writing is needed and it will review over the Autumn if will writing should become a reserved legal activity.
And here lies the conundrum they face. As I said earlier, 88% of people currently use a solicitor to write a will and, as a result, they receive protection because they are using a regulated professional. Research shows that more than 90% of people who use a solicitor are happy with the service they provide. What’s more, the cost of having a will prepared by a solicitor is relatively modest, with more than half of all consumers paying less than £100. All of which gives weight to the argument for making will writing a reserved legal activity.
On the other hand, making will writing a reserved activity goes against the grain of current regulatory thinking. The trend is to open-up legal services to greater competition and to allow more non-lawyers to undertake legal work. However, this cannot be done at the expense of consumer protection because to do so would cause a public outcry.
The regulators have some crucial issues to address over the coming months, which will result in a ‘life and death’ decision being made about the future of the will writing industry.
