The Personal Injury market is now controlled by the insurance industry. And, there is more to follow…
The combination of the Jackson Reforms and the Ministry of Justice reforms in personal injury were fully implemented in July of this year, largely in respect of new cases but some of the effects are affecting accidents before 2013. Cases where the damages awarded do not exceed £25,000 (and this can include some significant injuries) have seen the legal fees recoverable slashed dramatically particularly for cases where liability is admitted. These fees bear little resemblance to reality. It is necessary to obtain medical evidence to prove losses and when an insurer will not accept the true value of a claim, it costs money to pursue it. As the burden of proof remains on the claimant, unless an insurer agrees a fair and reasonable amount for the claim early on, it is unlikely that solicitors will be able to help in these cases as they will not recover their costs. The paying and receiving of referral fees for personal injury work has been banned. This is something that we applaud as in PMI we do not pay referral fees for any work that we receive. We have been fortunate that our clients find us through recommendation because of the reputation we have in this field.
Liability and legal expense insurers have taken over existing law firms and created law firms, announcing in many cases that they will become alternative business structures. In effect, these enable referrals of work to continue but now it is paid by way of profit sharing within an organisation rather than a fee, which would be illegal. Because a large part of the market is controlled effectively by insurers now, proponents will say that resulting efficiencies will ultimately benefit all consumers. We doubt that, because the primary objective for liability insurance companies is to reduce the amount they pay out on claims, to avoid claims where they can and to look at issues with the policy to see if they can, in some way, declare it void. Their motive is to maximise the return to their shareholders not to compensate the injured.
It has been the insurers’ aim for some time to control the claimants’ side of the insurance industry as of course it is in their best interests to reduce their outlay. We doubt that there will be any reduction in the overall cost of insurance premiums and sadly this will all be at the expense of those consumers who have legitimate claims. 2% of our population per year are injured. It is becoming increasingly difficult for clients to be able to enforce their legal rights to receive full compensation for their injuries. We hope that there is still a place for us in the market completely independent, unencumbered and still making a difference to the lives of our seriously injured clients. We are delighted to be recognised in the Chambers UK – A Client’s Guide to the UK Legal Profession 2014 as “leaders in the field” in personal injury receiving the highest accreditation of Band 1.
One of our clients said that we are “exceptionally personable and have always had the client at the heart of their drive and their thoughts”. We were described as “incredibly compassionate” and “maintaining our professionalism very well”.
Our Frances Pierce, head of the PMI Team, was also named a leading individual in the field of personal injury and clinical negligence work.