MPs announce new whiplash probe
An inquiry into whiplash claims led by the House of Commons transport select committee will begin later this year, the committee’s chair has revealed.
Louise Ellman MP said the study would focus on how to cut the number of fraudulent claims and make sure victims of road accidents who are injured can still get compensation.
Ellman, Labour member for Liverpool Riverside, told the Association of British Insurers conference on motor insurance that committee members met to decide on the inquiry.
She added that insurance companies would have to explain why they do not challenge more claims they believe to be fraudulent. ‘In the rush to get rid of fraudulent claims we shouldn’t dismiss the possibility that people have a genuine injury,’ she said.
The announcement of an inquiry comes in the midst of dramatic changes to the personal injury sector. As well as the Legal Aid, Sentencing and Punishment of Offenders Act coming into force on 1 April, fixed recoverable costs for low-value work will fall by 58% from the end of April.
In addition, consultation will close this Friday on raising the limit in the small-claims court from £1,000 to £5,000. The government has stated its intention to drive costs out of the system to ensure lower car insurance premiums.
John O’Roarke, managing director at one of the country’s biggest insurers LV=, warned consumers not to expect vastly reduced premiums as a result of the new fixed costs.
‘[I expect] a 3% reduction in premium, but generally we have already seen reductions in premiums of 12% and I am not hopeful there will be much more to come.’
O’Roarke claimed that 50% of whiplash claims were exaggerated or fraudulent, and that premiums would fall by as much as 15% if they could be eliminated.
He also issued a warning to any insurers looking to join with a claims management company to form an alternative business structure in response to the ban on referral fees from next month.
‘CMCs are going to want to run as an ABS as it’s a way round the ban but I am less convinced about the rationale for insurers to go down that route – we have an opportunity to clean up our act.’
Comments
Quelle surprise!
Judicial review whitewash on Friday and by Wednesday the insurers are now saying that we shouldn't expect reduced premiums.
How long after consultation
How long after consultation will we know the result?? Need to wind the business down......
Bothered!!!
They will be wiping out most of these claims by the suggested increase in the SCT limit which will, no doubt, be annonced following the close of the consultantion on Friday.
Why bother with this step. Surely much more sensible just to ban PI claims all together and allow insurers to take the premiums and then make no payouts to anyone, except, of course, to the goverment minsters with whom they already have an agreement....
Very funny to see the insurers already beginning to make the argument premiums won't be coming down much despite the fact we have saved hundreds of millions because we have lowered premiums already.
Strange they didn't say that in the consultantion.
Surely an increase in the
Surely an increase in the Small Claims Limit would ruin plans for anyone and everyone currently in the RTA market (including the big PI factories which have amalgamated with ABS's) as there simply wouldnt be an cost efficiencies for them either to deal with the work? what is the world coming too??
Sounds like the beginning of
Sounds like the beginning of the end of whiplash claims being pursued in this country? However, not sure why that won't lead to a decrease in insuranrce premiums, unless they are making massive profits from referral fees?
WAKE UP AND SMELL THE COFFEE !
Mr. Grayling !
You need to ditch the plans for 1st April. It is here in black & White .
The saving will never be passed on to the consumer !! The insurer are not even waiting until the changes are implemented before confirming they have no intentions of passing any savings on.
This is one big con and needs a public enquiry.
Small Claims
And what is the point of introducing FRC when, and I am sure, the small claims limited will be rasied to £5k anyway.
what a mess !!
Where are the convictions for fraud?
I am speechless!
50% of Whiplash claims fraudulent or Exaggerated! On what basis has our insurer foe come to this conclusion ? Just where are the convictions then? If Insurers and Defendant solicitors really believe the figures they spout then they had a duty to inform the police or is fraud not an offence anymore? The SRA should be investigating all the fraud departments to see why they have failed to report a crime and take action against them for failing to do so.
Maybe this is an area for the many defence criminal lawyers who will also be being put out of business when competitive tendering comes in - which it will!
Really This is a time for the SRA to show its teeth and the Law Society to demand that there be real cases to support these spurious figures. Do not allow the insurance industry to propogate more of this nonsense without factual evidence and if they have it why have they not done their public duty is ensuring they report this to the police. If they are and the police are not pursuing convictions why not?
The real fraud here is
The real fraud here is Defendant solicitors who run cases, often without instruction, pushing D1 into touch, not disclosing documents they have in their posssession until days before trial, making baseless allegations re "concerns" and then caving in at the last minute having racked up huge bills which they will pe paid for in any event by blinded insurer client.
I'm not sure which defendant
I'm not sure which defendant solicitors you have been working with but we never proceed without instruction and the only reason documents are disclosed last minute is if they have only just come into our possession. Any firm acting in the manner you describe is negligent. Furthermore, a lot of the time the only reason for "caving in" as you so delicately put it is because of the ginormous risk on costs if we lose! There is no level playing field and the defendant is always on the back foot.
I think the FRC was a big fat
I think the FRC was a big fat smokescreen to get everyone arguing over that and then BOOM up goes the STC limit , goodnight.
It doesn't make sense to completely wipeout claimant and defendant lawyers in one go. What about all thses ABS e.g BT in house claims what will they work on if the STC limit goes up??? Car hire recovery ??Why are Solicitors like Neil Hudgells buying up claimant PI firms if it all be redundant come August. Am I missing something that everyone lese knows or are people burying their head in the sand??
I have been saying for a
I have been saying for a while...a Public Enquiry is required.
A full and impartial enquiry would reveal what we all know already - that this is an unsubtle and thinly disguised sham to boost insurer profits, and nothing more.
Malfeasance in public office convictions are needed here. Let's get the real criminals locked up.
p.s. RTA, claimant hit by car
p.s.
RTA, claimant hit by car emeging into his path..fractured arm, pins / wires galore. Ruptured spleen but making a decent recovery. Limited specials, thus could be a sub 25k (ie new regime) case.
As a taster of how claimants will be treated in the third party capture world to come, the pre med offer for these injuries was £1,500 from the generous insurer. Not an uncommon scenario.
This in my view is where the real fraud lies.
I would love to see some
I would love to see some genuine exaples of that occurring!!!
As far as a Public Enquiry do you really think the public are that intertested??
Genuine examples of undersettling
Ask the MOJ. I have personally sent them tens of real case studies demonstrating this behaviour, and I know others have too.
Unfortunately the MOJ didn't regard it as "evidence", just as they didn't regard as "evidence" my firm's survey of every successful client since 2004, asking them whether they would pursue a claim without legal representation. 99% said no.
Jackson thought it was important enough to put into his report (footnote 7, page 221 - it was 90% in 2009 - it has risen to 99% in the last 3 years), and he relied in part on that survey when he recommedned not increasing the SCT limit. But then what does Jackson know.
Pre Medical Offers
Does anybody know any of the case law on this?
If a person takes a pre-med offer and compromises their claim, is it a "mistake of fact" such that rescission of the compromise agreement could be ordered? What about misrepresentation?
Obviously I meant in a
Obviously I meant in a circumstance when the amount of the offer is inadequate as against the damages that would be recoverable through court proceedings.
The case law is over a 100 years old
There is a case dealing with abuse by employers who paid off workers for paltry sums and tried to say that the payments were accepted in full and final settlement. The court gave them shortshrift. Any unrepresented claimant will easily be able to set aside these so-called 'settlements' by insurers. The problem will be educating the public to know when to seek advice.
I have just read through the
I have just read through the consultation again. I fail to understand why Grayling would suggest having specially trained Drs to assess whiplash if raising the Small Claims Limit would wipe out all their wok anyway as well as everyone elses. Is this another smokescreen/shma to pretend credibilty??? What a farce.
I hope they tell us the result o fthe consultation ASAP, NO JR again please that will be a farce as well. If he doesn't raise the limit I might have a glimmer of hope to downsize, cut out middlemen and try and earn a living. If not its curtains..... Stressul times
The only probe that should be
The only probe that should be conducted is one to assess the extent to which Grayling's head is up the insurers proverbial rear end. Evidently this is where he is formulating his conclusions.
This coming from a group of people, publicly elected, who have been fiddling their own expenses at the taxpayers expense.
Genius.
You couldn't make it
You couldn't make it up...
John O’Roarke, managing director at one of the country’s biggest insurers LV+, warned consumers not to expect vastly reduced premiums as a result of the new fixed costs.
‘[I expect] a 3% reduction in premium, but generally we have already seen reductions in premiums of 12% and I am not hopeful there will be much more to come.’
O’Roarke claimed that 50% of whiplash claims were exaggerated or fraudulent, and that premiums would fall by as much as 15% if they could be eliminated.
....oh, he just did!
will someone please close
will someone please close that stable door................
Close the stable doors...
...I've only encountered a few less than genuine claimants over the past 30 years.
These so called statistics must eminate from a different universe.
Surely, any ABS's and AIM's
Surely, any ABS's and AIM's would be getting squeeky bums with the latest buzz. just watch the share prices fall......
Costs farce
Mr Cameron take note. The insurers are laughing at you.
Having pulled the wool over the eyes of the Government (confirmed for example, by John O’Roarke, Managing Director at one of the country’s biggest insurers LV+, warning consumers not to expect vastly reduced premiums as a result of the new fixed costs) - they are now suggesting that premiums will remain high due to fraud.
The only obvious crooks I can see are the insurers themselves. Measures are already in place to tackle fraud - raise it as a Defence and pursue it at Court. The multi-billion pound insurance industry should not be permitted to keep turning to Government just because they want to increase their profits - no other business can (oh, sorry, I forgot about the banks......). This Government is a joke (or at least it would be if any of this was remotely funny).
Big Con!
I would say I cannot believe this but if I am honest I am not surprised at all. What were the two main reasons for reducing costs? Reducing insurance premiums and cutting fraud. Now the insurers have their way they are saying insurance premiums will not be reduced, and fraud allegations bring cases in to the Multi-Track and outside the scope of fixed costs in any event!
This has been a total con from the very start and in substance it basically amounts to the Government acting as a dictatorship. I wish Chavez hadn't died, we could have brought a vote of no confidence in the Commons and asked him to come and take over.
50% of all whiplash claims
50% of all whiplash claims fraudulent! I have been doing personal injury work for over 20 years - I wonder which ones of my hundreds of clients have been having me on all of this time!. Been doing a good job of it is all that I can say. Amazing that they have all got past the orthopaedic surgeons with their ridiculous fictions of aching necks - or maybe they are being given backhanders by the lawyers who are all in on it as well. The whole industry is obviously in on some massive insurance fraud and thank our lucky stars that this decent insurance chap has come out and rescued us from it. He is so very very important that obviously he must be right - not having us on is he ? exagerrating these figures a teeny bit to get a pecuniary advantage out of the government.
Other Businesses Should Learn
Other businesses should learn from the Insurance Industry:
Supermarkets (who like insurance companies already make vast profits) should inflate the price of say meat and blame the UK's animal welfare laws. When the public complain about the ever rising price of meat the government can legislate to take away the laws that protect animals. Supermarkets can put the price of meat down by say 3% and make even bigger profits. Genius.
The only difference with the insurance industry is that motor insurance is compulsory, eating meat isn't.
If only we could apply this model to Legal Services.
Rescission
The insurer does not owe any duty of care to the unrepresented claimant (and there is no obvious relationship which might give rise to undue influence), so it is difficult to see how the claimant could seek to set aside an under-settlement, unless he could point to a specific misrepresentation which induced the contract of compromise.
The claimant might be on slightly stronger ground if the insurer dealt with him through its solicitors and those solicitors were aware that the offer was much too low. Obviously, a solicitor does not normally owe a duty to his opponent, but there are exceptions (Dean v Allin & Watts [2001] EWCA Civ 758 and Al-Kandari v Brown [1988] EWCA Civ 13 being two examples). See also the Law Society's Practice Note on litigants-in-person (April 2012) and the decision of the SDT in the Davenport Lyons case.
And what about the REAL victims of whiplash?
At present I am awaiting an MRI after suffering an RTA. For obvious reasons I will not go into vivid details, suffice to say that my doctor is so concerned with my lack of progress that we are now possibly looking at nerve damage. From reading here the fact that I have a genuine injury does not appear to rate too highly as long as we can allegedly knock a few percent off the insurance cost, I say allegedly because I like many others believe that this simply will not happen.
Whilst I understand that we have for a greater part become a 'blame claim' society - due partly I think to relentless advertising and society as a whole, one cannot escape the fact that once again a ruling is on the cards that aims to give a blanket response to individual problems. Not everyone who claims is a fraud or for that matter actually injured and each should be examined under its own merits. Any blanket ruling will (as has happened too many times to count in the past) immediately fall against those with a genuine case to answer. Just when I thought it could get no worse..
Can I whip it? No
All of these insurers/ministers etc should be made to participate in a road traffic collision at around say 20 to 30mph so they can decide whether or not they are injured or not.
Let me get this right, remove
Let me get this right, remove their liability to have to pay pretty much any form of costs in relation to PI claims and they might, if we're lucky, reduce premiums by 3%!
Surely this proves that the idiots that are the current Government are still barking up the worng tree and simply making it even easier for the insurers to bulk up their coffers!
Can somebody tell me what our governing body plan to do to fight this farce?!
Lets just ignore the hundreds
Lets just ignore the hundreds of claims being brought 21/2 years down the line, occurring at less than 5mph with no damage to either car, eh? Seriously, if solicititors got their head out the sand they wouldn't be in this position
FRF - you appear to be
FRF - you appear to be suggesting that some claims are speculative and some probably are in all honesty as wherever there is potential payout there will be those who take advantage - ask the MPs. Indeed, one insurer organisation suggested that the number of fraudulent claims was 7% - thats right 7%. So in your eyes the 93% should be penalised for the actions of so few.
If an insurer or any other defendent has any doubt at all about the legitimacy of a claim then they already have the tools to do something about it. It is the claimants who have the burden of proof in such cases so make them do it. If there is little upon which they can 'hang their hat' ATE insurers wont back cases and firms who take such cases wont risk their own funding and resouces on speculation and neither will claimants.
In short your argument is just another falacy of the insurance industry or head line reader section of society.
I wish i never studied law
I have recently completed by Law Degree with high hopes and ambitions to be a successful lawyer since Mr Grayling's dealings in this industry i am sticking to the original game plan, am going to be a motor mechanic, the uni fees the loans the death of the sector, its like a nightmare.....when will i wake up what do i do with the Law Degree, might just go and live in China where things are cheap.....nice one
Totalitarianism
It was a bright cold day in April and the Clocks were striking thirteen.
I am greatly concerned about the new proposals and the future of PI. However what is of equal concern is the way that the reforms have been implemented. It appears that we have a Government
who are controlled by the Insurance Industry. Further, although the Tax Payer/ Government virtually own some Banks, there is no control over them. The Government advise against Binge Drinking but the large chains, at the moment' sell very cheap alcohol. Petrol Prices go up and rarely come down.
Professions, Small Businesses are easy targets; as are Benefit Claimants. Do not think that the author is some raving lefty. I was brought up in a family in Politics and reached the age of ten before I realised that Bloody Socialist was two words.
I think we all have to consider in which direction this Government is proceeding and what the future
holds for the vast majority of the population
Response to "frustrated"
Just read "Frustrated"'s comments above;
Please stop the hypocrisy. You and your ilk have no defence to this and stop trying. You know, if you actually work in a defendant firm that the reality is:
Large defendant PI firms have dedicated fraud departments that work as follows:
The insurers and their panel solicitors have agreements for very low fixed costs in fast track claims, unless the claims come out of the fixed cost procedure.
A claim will come out when fraud is alleged. It is therefore in the best interests of the Defendant firms to suggest to insurer clients that “key indicators” suggest fraud so the law firm can then charge an inflated hourly rate. Expensive investigations are then undertaken and costs escalated.
The Defendant solicitor is required to work a minimum of 6 but usually 7 to 8 chargeable hours a day (Defendant firm’s policy) and increasingly are put under pressure to meet these targets . Costs targets are "encouraged" to be met.
In the majority of the apparent fraudulent claims fraud is never alleged. The majority of these claims then settle because the suspicion of fraud is unsubstantiated. This is never brought to the courts attention as the insurers can escalate costs without it ever being put before a judge.
I simply do not accept documents are disclosed late because you get them late. I have ample experience of insurers suddenly finding documents after applications are made. I also have experience of documents that have been altered, Accident reports that purport to be contempraneous but can't be (we are provided with the accident date which turns out to be incorrect but our LOC will give the wrong date then hey ho accident report dated the date we initially thought the accident happened.) A site inspection which showed half of a gyms equipment was not working but daily inspection records showing no defects!
What do you mean that you can't take fraud cases to trial because of the potential costs. Sorry are you saying that insurers and their defendant slaves knowingly settle fraudulent cases rather than allowing a finding of fraud and criminal proceedings to be brought. Are you suggesting that there is a policy of aiding and abetting a criminal offence?
Look at the level of prosecutions and logic dictates either insurers and defendant solicitors are making up their statistics or they are making up their statistics!
I assume you are a defence lawyer and think on ... Insurers now have what they want and will not be paying the fraud departments, which have subsidised the non fraud work, the vast sums of money they have been. Those large Departments were always time bombs ticking and I am afraid you will feel the full impact of the explosion along with us. Your job is as threatened as my employees are: Unless you are one of those moving into claimant work on the back of your firms ABS with an insurer....but surely not, that would just be hypocrisy!
Again Kerry - bang on the
Again Kerry - bang on the money.
A Suggestion for LS / APIL etc...
May I suggest that the Law Society / APIL / MASS / ILEX / AJAG and the bar join forces in order to arrange a day in the very near future where all those to be affected by these changes, not only lawyers (claimant and defendant), but support staff, costs draftsmen, medical agencies, rehab providers, office cleaners, legal marketing companies, and all other peripheral service providers be invited to march on Downing Street in a day of protest. I know for a fact (and quite rightly too) that many insurer claims handlers (and even more so def solicitors) are now also getting worried for their future and starting to realise that without us, they're somewhat redundant too. Bring them along as well. More the merrier. Invite your MP if they're supportive too.
What is needed is to bring this sharply, and urgently, to the attention of the public in an organised and structured way. I'm sure firms up and down the country will have no issue closing the doors for 1 day for the good it might do. All very well debating here, but frankly, it's a waste of time. The public do not read these hallowed pages (other than Kelly Matthews- and she's not invited), and they clearly have no influence, as demonstrated over the last few months compared to where we are now.
I asked the law society about
I asked the law society about this. They stated, and i'm paraphrasign slight here "most of the reforms are imminent so its too late for a march"
Oh well. Nevermind then. May as well shut it all down now.
Shame we cannot utilise the
Shame we cannot utilise the Bribery Act legislation to examine the relationship between the ABI and the Government
BACKBONE
Fortunately I am not a solicitor I have some backbone. When will you all realise that lying down and playing dead will leave you ending up unemployed and on the funeral pyre. It's quite simple really. Get together and make a fuss. I am seeing my MP and I am getting my work colleagues to see their MP and if I was a solicitor I would be joining forces with every other solicitor and making sure that our points of view were aired in the public. Contact this limp SRA and tell them that if they don't help you then you won't be with them so don't worry about upsetting them!
The solution is easy, it is obvious that there is a news blackout and the only reason that can be is that the government and the insurers are petrified that the true extent of redundancies and all the other things we know they want to hide will be revealed.
Can you Explain
Can someone explain something to me. If in a normal case a Solicitor would receive say £1200 in costs, and from that pay anything between 500 and 700 in referral fees, then wouldn't the new lower costs still place them in the same position they were in before. The only difeference is that they now have to source work from their own advertising rather than relying on this unneccessary extra layer of claims managers.
Am I missing something, I am sure I am.
...and how, exactly, would
...and how, exactly, would you expect them to pay for that marketing?? As a firm we don't pay referral fees but our cost of acquisition runs to around £400 per case. And just so you are fully informed did you realise that anywhere between 24% and 51% of your car insurance premium is used on insurers marketing activities......
Lucy/Desmond Can you now
Lucy/Desmond
Can you now start advertising in the press, full or half page, explaining to the public the true position? If you don't do something the Law Society will be many thousands of pound down over the next few years in Practicing Cert Fees from PI sols who won't be there to renew, closely followed by Criminal Solicitors after Grayling has finished with them, thus rendering the Law Soc much reduced and irrelevant.
Kind Regards
Surely the Government is
Surely the Government is already reacting to the general pubic opinion whi want something done to stop the increasing number of whiplash claims? Actually advertising what is going on is likely to boost support in favour of the Government not lead to changes in their plans.
Face facts the greed of some claimant lawyers as now spoilt things for every claimant lawyer who deals with low value PI claims. .
Top class - I would sugest
Top class - I would sugest that the majority of the public are not against whiplash claims but they do object to the relentless advertising and calls. The answer is therefore to restrict the marketing which insurers also play a part through intermediaries so they can claim not to be involved.
INVITATION TO L.SOC / APIL ETC
May I suggest that the Law Society / APIL / MASS / ILEX / AJAG and the bar join forces in order to arrange a day in the very near future where all those to be affected by these changes, not only lawyers (claimant and defendant), but support staff, costs draftsmen, medical agencies, rehab providers, office cleaners, legal marketing companies, and all other peripheral service providers be invited to march on Downing Street in a day of protest. I know for a fact (and quite rightly too) that many insurer claims handlers (and even more so def solicitors) are now also getting worried for their future and starting to realise that without us, they're somewhat redundant too. Bring them along as well. More the merrier. Invite your MP if they're supportive too.
What is needed is to bring this sharply, and urgently, to the attention of the public in an organised and structured way. I'm sure firms up and down the country will have no issue closing the doors for 1 day for the good it might do. All very well debating here, but frankly, it's a waste of time. The public do not read these hallowed pages (other than Kelly Matthews- and she's not invited), and they clearly have no influence, as demonstrated over the last few months compared to where we are now.
What exactly is there to lose by doing this?
In reply to DM
Have you writtent to the Law Society / APIL / MASS / ILEX / AJAG and the bar? We will support you in this, get a date sorted lad!
I have previously written to
I have previously written to everyone over the last few months, but they all read these forums. If they can think of a better idea, I'd love to hear it. If not, perhaps if others endorse their agreement, this might result in some action being organised.
Apil alone has 4500 members. If they all bring an average of 10 people from their offices, we have almost 50,000 people already. The spectacle of 50,000 soon to be unemployed people on the news would not be good for the govt.
The press have ignored us so far. They couldn't ignore that. And the public would then become interested. Press would want to interview and publicise APIL / L Soc leaders views and comments. Those would have to be hard hitting. No more stiff upper lip - they need to tell it as it is and make the public question what we already know - that this is at best grossly incompetent, and at worst fraud. And most importantly of all, they need to understand that the govt are stripping the electorate of their rights, and yet more money, for no better reason than lining insurers already obscene profits. Full impact assessments on the economy; Loss of revenue, increased state welfare burden etc etc. Where exactly does the government expect to get the money to fill the catastrophic hole that these reforms will leave? they can only get it from one source - the electorate. Or sink the UK into even deeper debt.
Whichever way this is interpreted, it is not good news for the public on a micro level, or the UK economy on a macro level. This shambolic nonsense MUST be bought to the attention of the public so that they have the opportunity to understand it. Sufficient outrage (and let's face it, most people don't trust insurers or govt) - will result in the certainty of tory death at the next election. And that's the ONLY thing they fear.
So, to our representatives - when is this happening?
making a start
I have my doubts about a day of action at this point
A hostile media will portray this as a parade of the fat cats.
First we should establish a multi-party action group made up of members of the Law Society APIL MASS ILEX BAR etc to campaign and educate on the destruction of our legal system
The advantage of such a group is that it can operate outside the usual constraints impeding decisive action.
Look at Liberty which is a respected organisation and its arguments are heard with respect.
We have to create a new narrative regarding the law and access to it dislodging stereotypical prejudices in the process.
Actions groups work and can get results
Sadly existing professional bodies may need to combine in a professional alliance since they are not equipped to fight a dirty war by themselves
I'm in !!
I'm in !!
Presentation
If you present this as being about lawyers losing their jobs or fee income - and that is how it will be painted by insurers and some journalists - you won't get any sympathy from the public. The Law Society needs to join forces with the Bar Council to put together a convincing campaign which demonstrates that this is about citizens having their rights taken away or diluted. Even then, the obvious question will be: why are the Law Society and the Bar Council campaigning about this issue rather than about the government's proposal for secret courts?
action
Agreed
We must take the moral high ground
TimB, Clearly the headline is
TimB,
Clearly the headline is not us losing our jobs / fee income. That is of course a major concern to all of us on a personal level, but the issues go far deeper than that, and this is what the public must hear about.
The public love a good scandal though. And this is a cracking one. All the facts put together make for quite astonishing reading. From the closed door meetings, to the hush hush emails aired at the JR, to Grayling's £71k office running costs paid by insurers, to the 88% govt interest in RBS, to the undisclosed interests of Djanoglump, to the already excessive profits of insurers and their mutterings 4 days after the JR that actually, they're not so sure now about reducing premiums. to the plans to increase the SCT and finish off PI completely. Could lead to panorama etc doing a full piece. Hell, let's get Ann Robinson / Dominic Littlewood on the case. Interviews with claiamnts who have gone through hell at the hands of the insurance machine. Won't have to look hard to find them will we.
You couldn't make this stuff up.
Hungry journalists would love to sink their teeth into this scandal and interview ministers and give them a good going over. This isn't about us. It's about the public. It is they who are being duped and lied to. It is however up to US to do something about this. No-one else will.
And as I say, unless there are any better ideas out there - what is there to lose exactly?
So stop being so defeatist and timid. Stand up for yourself, your profession, and the rights of the people who (almost) elected the tories to their position of abuse.
next steps
Hi
Agree what you say but we have to take practical steps to harness the anger of the profession
Even strikes have to be planned and we need to plan carefully
Hence my invitation. If I had
Hence my invitation.
If I had a database of all APIL members so I could do an email shot, I'd organise this myself. I'm sure APIL etc though would do a better job.
something those of us who use
something those of us who use social media can do now is draft a few bullet points/time line to put on our work and personal pages and get it spread as widely as possible whilst we work on other methods of publicing whats happening.
but will they ? This is why
but will they ?
This is why as Genesis has said we need to form an action group
DAVID CRAUSBY'S EARLY DAY MOTION
Here's a start, anyone concerned in the industry could forward this letter template to their MP and if enough people do it they will have to listen!
Dear MP
I wanted to draw your attention to David Crausby's Early Day Motion about a proposed raise in the Small Claims Limit for people injured in road accidents.
http://www.parliament.uk/edm/2012-13/1140
Raising the limit in this way will specifically exclude injured people from obtaining their own legal and medical advice. They will be at the tender mercy of the insurance company of the person who ran into them. This amounts to a denial of justice to those people.
Whilst £5000 might be a "Small Claim" for Aviva, it is probably a quarter of what a Claimant will earn in a year, a very significant amount to them.
The argument is that insurance premiums will come down. The Chairman of LV= suggests the reduction will be in the order of 3%. He also takes the opportunity to accuse those injured by their customers of being fraudsters, without offering evidence of their alleged and uninvestigated fraud.
http://www.lawgazette.co.uk/news/mps-announce-new-whiplash-probe?utm_source=emailhosts&utm_medium=email&utm_campaign=GAZ+06%2F03%2F2013
I submit that 3% of anything is a "Small Claim" in any language, and not worth selling the rights of redress of injured people for.
I urge you to sign the EDM.
Many thanks.
My local MP is supportive. I
My local MP is supportive. I informed him about this EDM a couple of days ago and he's signed it. All good stuff, but I'm convinced we need the "big bang" of 50,000 on Downing Street to kick start things. Anything else will be ignored I fear.
Fixed Costs Reforms
I have been researching this since around 2006, and am now studying towards a PhD researching the RTA claims process for claims under £10k. I have written extensively to the MOJ, ABI, APIL etc., and only two weeks ago fired letters off to all the prominent bodies, MP's Lords Justices and Ministers. This was before the announcement of the reduction to fixed costs.
My questions/issues to consider are as follows:
1. Lord Woolf stated in his report (1996) that there was NO research available on solicitors costs and that this should be carried out. As far as I am aware none has EVER been commissioned. If solicitors costs were unknown how could costs be said to be 'disproportionate'? It is so called 'disproportionate' costs that have been the driver for the fixed costs.
2. Look at the parties who have ever been involved in the process. Consider the firm types and what experience, or lack of experience they had in personal injury claims.
3. Look at the relationship of APIL acting as a 'stakeholder' in the reforms, especially if EC members were at meetings with insurers discussing fixed costs. Which EC members had commercial arrangements with insurers for referral fees and how much profit costs did these firms receive after paying insurers referral fees? Was there any conflict of interest? These meetings were used to set fixed costs for the rest of the profession who were cut out of the process remember. It surely raises questions about the level of costs we have now? I have seen evidence of the way claims are handled as fixed costs have been reduced and the amount of damages obtained through 'commoditisation'. My research will be specifically focussing on this in the next year or so.
4. Professor Paul Fenn has, as I understand it, been the economist involved prominently in setting fixed costs over the years. He is the 'Aviva Chair of Insurance Studies' at the University of Nottingham. Check out the Business Schools website. This alone should raise serious questions.
5. Research Lord Justice Jacksons practice area before he carried out his report.
6. I asked Professor Fenn and the MOJ some time ago to disclose the research used to set fixed costs since they were first introduced. This request has been declined by both parties.
7. In April 2011 I wrote to all 38 RTA insurers, the ABI and the AA asking them to disclose their evidence that accident compensation claims were responsible for driving up car insurance costs. Not one of the insurers or the ABI acknowledged my letter. The AA did acknowledge but did not disclose any data. I have also written to the AA on many occasions after one of their press releases asking for evidence to support what they say. None has so far been produced.
8. Since 2010 when fixed costs were reduced, I believe 95% of accident claims could have been settled for around £4,000 in total - £1200 solicitors fixed costs, £1200 for the vehicle repair (the extent of which insurers have arrangements with car repair centres for fixed costs for car repairs is another area which requires research in itself) and around £1600 which appears to be a typical settlement for damages. With the limited data that was disclosed with the Woolf report the insurers should explain how it is mathematically possible for costs to have risen. The insurers have data to clarify the total cost of claims.
9. Does research from the National Accident Helpline show that around 97% of all RTA claims emanate from the insurers selling on claims to their panel solicitors? In April 2011 I asked the insurers to disclose evidence of how many claims emanate from 'greedy solicitors' and claims management companies. My letter was not acknowledged. They have data to confirm where claims originate from.
10. The limited data that I have seen disclosed only reports costs as a proportion of damages. To my knowledge there has been no research looking at the REASONS behind costs, if they are perceived to be disproportionate. The Transport Select Committee has confirmed in writing to me that they have never seen any research looking at the reasons behind the levels of costs. They have only had research showing costs as a proportion of damages. Again, a key issue.
11. The Law Society has already reported that no evidence supported any of the reforms being introduced as a result of the Jackson report.
12. Somebody alleged on another post on the Gazette website that they attended a roadshow where an insurance representative said they went to the Government with a list of reforms they wanted out of Jackson never thinking they would get them all, and having obtained what they want as a result, they would get the Government out of their back pocket. If this is true then there are questions when the insurers met with Mr Cameron and other parties were excluded.
13. £500 fixed costs are not sufficient to run a claim properly even if a firm has no acquisition costs. I wrote to the Competition Commission before the level of fees was disclosed - this is surely anti-competitive because it only becomes economically viable if a firm is handling thousands of claims. Again, questions about how firms obtain claims, whether for payment or not, and whether it is a level playing field for smaller firms. Research should be carried out to assess whether Claimants going through panel solicitor firms obtain similar levels of compensation as independent firms because initial research suggests not. Again, this is the focus of my PhD research.
I have yet to see any evidence to make the claim for fixing costs in personal injury claims let alone at the levels just announced. There should be a full inquiry looking at, with full disclosure, all the evidence on costs since Lord Woolfs report to date. Proper research should be carried out to determine what it costs to properly run a claim (with full involvement of the profession) and I put this in my letter two weeks ago to the various parties I wrote to. Has selective data from insurers showing costs as a high proportion of damages has been used to set levels of fixed costs without any consideration of the reasons why costs were perceived to be high? Until the data is disclosed we will never know will we! This is the key to this whole mess as far as I am concerned. I will continue to push for its disclosure but on the basis the Law Society has been denied disclosure everyone should be asking searching questions of the whole process.
Questions/issues
Elaine's 13 points do not come as any great surprise. As for Jackson LJ's practice area, he was a professional negligence specialist. The reality is that very few barristers or judges have any great understanding of costs; or their understanding of costs is very much a legalistic one, divorced from the practicalities of having to deal on a day-to-day basis with awkward or demanding clients or obstructive opponents. Look at what Jackson LJ had to say about BTE insurance: it was (with respect to his Lordship) quite clearly the work of someone who had no first-hand experience of how BTE insurance (and BTE insurers) work in practice.
Questions/issues
Sorry I did not make it clearer - research who Lord Justice Jackson was instructed by!
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Submitted by genesis on Thu, 07/03/2013 - 13:29.
Agreed
We must take the moral high ground
LOL - I think it's a tiny bit too late for that??
My comment was made in the
My comment was made in the context of being part of a campaign.
Lawyers having been moralising for many months.
My suggestions are well subtle
We need to be clever
A strike will be hard to organise and will achieve little I fear
We need to meet and plan in the first instance
"Herd of cats" springs to mind - I know this to be true from practical experience
Refer concerns to Andy Slaughter.
I contacted a national newspaper regard the meetings between govt and insurance industy asking them to investigate a possible policy for cash story but got no response.
Elaine you make sense. I have written to Andy Slaughter demanding an inquiry into the above. If everyone does this it will force him to put it on the agenda.
Put pressure on for Elaine's questions to be answered.
This goes far beyond small firms like mine being squeezed out of the market this is about a systemised attack on basic legal principles. It is about demonising legitimate claimant's and govt collaboration in big business and interfering in the free market (something they don't have any appetite to do with the utilities and fuel companies!) for what personal advantage?
The country is run by politicians whose arrogance astounds me but can be used to our advantage. They feel so exempt from scrutiny that they are indiscreet and their indiscretions can be easily exposed if there is a spot ight put on them.
Please enlighten me. 50% of
Please enlighten me.
50% of whiplash claims are exagerated or fraudulent. Tautology or matter of degree?
Insurers are settling such claims believing this to be the case. Facilitating a fraud?
RBS owns a number of insurance companies. RBS is in turn "owned" by the public.Therefore, in our name insurers are spending our profits for the benefit of fraudulent claimants. Our pension funds suffer due to reduced dividends. Should our pension fund holders be asking questions of the insurance industry. Should someone in politics not raise these concerns about what is done "in our name"?
We own the bank that owns the insurers, that increases the premiums we pay, by paying out in unmeritorious cases?
The insurers ambitions will not be derailed by anything save putting politicians at risk that they will lose their power come the next election. Those that suggest using TV are correct. Once a chink appears in the edifice then the underlying fractures will become apparent. Elaine's approach is the right one. Unfortunately, she will continue to encounter brick walls. Only a well know figure, such as Paxman, has the public persona to hold the insurers to account or make it clear that the country is being taken for a ride.
Please enlighten me. 50% of
Please enlighten me.
50% of whiplash claims are exagerated or fraudulent. Tautology or matter of degree?
Insurers are settling such claims believing this to be the case. Facilitating a fraud?
RBS owns a number of insurance companies. RBS is in turn "owned" by the public.Therefore, in our name insurers are spending our profits for the benefit of fraudulent claimants. Our pension funds suffer due to reduced dividends. Should our pension fund holders be asking questions of the insurance industry. Should someone in politics not raise these concerns about what is done "in our name"?
We own the bank that owns the insurers, that increases the premiums we pay, by paying out in unmeritorious cases?
The insurers ambitions will not be derailed by anything save putting politicians at risk that they will lose their power come the next election. Those that suggest using TV are correct. Once a chink appears in the edifice then the underlying fractures will become apparent. Elaine's approach is the right one. Unfortunately, she will continue to encounter brick walls. Only a well know figure, such as Paxman, has the public persona to hold the insurers to account or make it clear that the country is being taken for a ride.
Jackson LJ
Researching which firms/lay clients used to instruct Rupert Jackson is a pointless exercise. He will have acted for a lot of insurers, but so what? He will also have acted for those making claims against insurers (or their insureds). I don't believe that Jackson LJ had any axe to grind when producing his reports - and, in any event, the government has not implemented the entirety of his suggestions.
Suggesting that the reforms are based upon an absence of reliable data is fair enough, but anything which implies that judges or academics did not approach their tasks dispassionately is not a wise move. Whether it is a good idea to get judges and academics to produce reports on costs - a topic upon which solicitors are better-placed than anyone to comment - is a differently matter entirely. If you want a view from the sharp end, contact Kerry Underwood, who writes some of the best commentary which you will find on costs issues.