I am writing to shed some light on the current referral fee scheme, which Jack Straw appears to have adopted as his current specialism.

There is one major misconception which appears to be the primary motivation fuelling Mr Straw’s outrage at the system. It is that referral fees paid by claimant solicitors to claims management companies are causing motor insurance premiums to increase. This is not the case. There is no such correlation. Insurers do not pay those referral fees, the solicitors do. Therefore, the fees have no impact whatsoever on premiums.

I specialise in recovering solicitors’ fees from insurance companies following the conclusion of personal injury claims. I have never sought to claim a referral fee from a paying insurer. Indeed, it would be pointless doing so because there is not one single UK insurance company that would agree to pay it. If the subject were properly researched by Mr Straw, he would not find any example of an insurance company paying such a fee; therefore, the idea that it is those fees that are causing premiums to escalate is lacking any foundation.

The total lack of causative link between claimant referral fees and insurance premium increases is an elementary issue and one which would have been obvious with a little basic research. However, it seems that Mr Straw prefers to say what he thinks the public want to hear, rather than to establish any bases for his assertions.

Guy Platt-Higgins, director, Law Costing, Birkenhead