What is going on in the credit hire market?

Today we have reported that two major credit hire operators, Drive Assist and Elite Incident Management, have fallen into administration.

Drive Assist, which is backed by private equity house Charterhouse, has had to make 259 of its 640 staff redundant. Administrators Zolfo Cooper were appointed last night because the company had serious cash flow problems.

Drive Assist’s administrators blamed the recent loss of a major customer as a contributing factor to its cash problems. In the end, administration was the only option available, they said.

History of problems

It’s not always been an easy ride for Drive Assist. In July 2011,  it had to overhaul its financial structure after losing two major contracts that left the company struggling with a heavy debt burden. A year earlier, Drive Assist had to reimburse insurers following a KPMG investigation that was sparked by whistleblower allegations of overcharging.

Then there’s Brighton-based Elite Incident Management, whose liquidation is expected to be confirmed by liquidators Jeremy Knight & Co later today. The motor claims outsourcing company provides accident management and claims handling services to insurers and brokers, and it is still unclear whether any jobs are on the line here.

Today’s developments have put credit hirers under the microscope again, and the industry will be watching closely as more events unfold. But observers will be asking what the hell is going on?

Lockton chief exec to retire

Also today, Julian James announced his shock resignation from Lockton. James had been instrumental in growing the Lockton International business, telling Insurance Times in an October interview that revenues had increased from £95m in 2006 to £154m this year.

It’s unlikely the former Lloyd’s director of worldwide markets will be out of action for long.