The RAC has scrapped its 22-firm panel for personal injury claimant work, and is understood to have selected national firm Irwin Mitchell as sole provider, it emerged this week.

The RAC's owner, insurance giant Norwich Union, launched a review of the motoring organisation's legal services arm in October following its takeover of the business.


An RAC spokeswoman said: 'The outcome of the review has identified a [need] to rationalise the panel to fit with future business requirements.'


She confirmed that it has sent letters to the 22 firms currently acting for its motor legal expenses policyholders, and had 'served notice on them accordingly'.


Both the RAC and Irwin Mitchell refused to confirm or deny that the law firm has been chosen as sole provider. Sources said the successful law firm would 'definitely' be paying a referral fee for the work. Irwin Mitchell declined to comment.


One personal injury solicitor said: 'If an insurance company is giving what could be 10,000 cases a year to one law firm, then there are ethical considerations when the firm acts against the same insurer. This is a very worrying scenario.'


Solicitor Dominic Clayden, head of technical claims-legal at Norwich Union, insisted there would be no conflict if Norwich Union were referring a substantial amount of work to one law firm. 'We are absolutely clear that there is a separation between our defendant liability work and the RAC's claimant legal services.'