According to recent research into the number of road accidents in the UK has cast a very interesting light on the personal injury market. Despite the fact that the number of road accidents has fallen by 40% during the last 15 years, the number of injury claims has increased by 89%. There are a number of reasons why claim figures have increased and there are a number of actions the authorities are taking to combat this.
Type Of Personal Injury Claims
During 2015 in excess of 770,000 personal injury claims were made with regard to road accident injuries. It is believed that around 80% of these claims involved soft tissue injuries such as whiplash which has certainly figured prominently in the personal injury market. While sceptics would have you believe that the vast majority of the increase in claims may be down to fraudulent activity this is not necessarily the case.
Greater Awareness
The general public has been made aware of their rights with regard to personal injury claims as a number of legal firms look to attract more business. Quite how it is wrong to inform somebody that they may be eligible for a personal injury payment due to an injury out of their control is bizarre. You only need to look at the television and the Internet to see the massive increase in personal injury lawyer adverts – which has helped genuine victims find assistance.
Interestingly, as the UK authorities look to reduce the impact which personal injury claims have on other areas of industry, in some ways this has actually focused more attention on potential claim cases.
The Knock-On Effect
It is common knowledge that many lawyers work on a No Win No Fee basis taking up to 25% of any successful personal injury claim. There is absolutely nothing wrong with this type of arrangement which has been ongoing for many years. In some ways, this actually incentivises personal injury claim lawyers to only take on cases which are above board otherwise they are potentially wasting their own time and money. There are obviously some legal firms who have been chastised for an array of more dubious claims but let’s not forget those lawyers actually offering a genuine service to the general public.
On a typical £3000 personal injury claim for whiplash, a legal firm could in theory receive as much as £750 plus legal costs. The actual level of legal costs lodged per successful case can vary from the actual payments received via the courts. It is worth remembering that the courts do have the ability to reduce what they see as excessive legal bills in these circumstances.
Proposed Changes To The System
The UK authorities have announced plans to replace claims for “minor injuries” with actual physical treatment as opposed to cash payments. While many people will question this move, amid suggestions it does not recognise any mental trauma, there is certainly some sense behind the idea. If you have a soft tissue injury then potentially the best course of action would be physio from an expert. In theory, it is difficult to see how anybody could question this change in regulations.
When you also take into account that this move has the potential to cut average motoring premiums by up to 10% (an average of around £43 per person) is this not a win-win for all parties? Sufferers will receive specialist treatment for their injuries, the more spurious claims will likely fall in number and there will be a general reduction in motoring insurance costs. When you look at it from this angle it does certainly have some merits.
Reduction In Legal Fees
The authorities also announced that they are considering increasing the upper limit for minor injury claims brought before the small claims court. The maximum limit could potentially increase from £1000 up to £5000 which would seriously reduce legal fees. This would probably lead to personal injury claim lawyers focusing on potentially higher-value personal injury claims and could lead to smaller claims being ignored.
Using A Sledgehammer To Crack A Nut
On the surface, the array of proposed changes by the UK government makes perfect sense from a layman’s point of view. Those with valid claims would still continue with their action no matter the changes in the small claims courts or legal expenses. However, let us not forget the array of relatively low-valued personal injury claims which would be pushed through the small claims court. Would these claims potentially receive less exposure than those with larger compensation payments taken through the traditional court system?
The whole idea of the personal injury market is not only to argue for compensation for victims but also to ensure that third parties held liable are forced to make changes to the way they operate in the future. Many of these changes only come about because of “bad press” so if the small claims court cases received relatively little in the way of exposure what would be the incentive for guilty third parties to make what could be potentially expensive changes?
There is a growing argument that the proposed changes are effectively a means of using a sledgehammer to crack a nut. Why not focus on those who are involved in allegedly dubious claims? Why not use this investment by the authorities to target the scam/fraud artists? At the end of the day, unless the potential penalties for pursuing bogus personal injury claims are increased why would the fraudsters stop now?
