Solicitors call for increase in criminal injury compensation cap

At the recent conference of the Association of Personal Injury Lawyers, delegates called for the government to increase the current cap on compensation for those who have been victims of crime. As part of an ongoing consultation by the Ministry of Justice, they have been calls for increased to the current compensation cap– set at an absolute maximum of £1/2million however serious the injuries suffered by the victim.

Media coverage of accident claims sadly revert for too often to the “compensation culture” stereotype. An example of the kind of real injustice caused however by the current cap for victims of criminal injuries is that of Thusha Kameleswaran. This poor little six old was paralysed following a gang shootout in 2011. £1/2million sensation is never going to anywhere near even covering her ongoing care or medical needs. Her own personal injury solicitors have suggested that her level of catastrophic injuries would probably have resulted in a £5m compensation payout if, for example, they had been resolved of a motor accident.

The outcome of the MoJ review is expected sometime later in 2012.

Derision at government’s proposed cap on Road Traffic Accident claims

The government’s proposed £300 cap on Road Traffic Accident claims through the RTA portal, an online system which handles routine, low value personal injury claims, have been met with widespread derision across the legal profession.

This slashing of the current legal fee would mean a significant decrease of 75% from the current £1200 cap, itself also a significant drop from the previous rate charged by solicitors which is seen by many as a cut that would not be tolerated in many other industries.

Whilst Bonallack & Bishop enjoys a solid enough reputation to be able to attract high-quality compensation claims and therefore avoid lower level claims work, there are many smaller law firms who may be forced to accept this level of work albeit to be undertaken by junior fee earners or newly qualified and inexperienced staff which will in turn devalue the claims process and industry.

Conversely, insurance companies will fully benefit from the changes and the level of competition could prove untenable with highly qualified lawyers employed by them pitted against inexperienced legal staff in other areas. In other words, rather than a no win no fee result for the consumer, we will soon be seeing a win win result for the insurance companies.

Some claimant personal injury solicitors have also expressed concerns over the potential increase in fraudulent claims whilst others believe that the cuts will give rise to corner cutting and reduced due diligence.

The proposal came to light during roundtable discussions with the justice minister, Jonathan Djangoly, although the Ministry of Justice is insistent that figures have yet to be finalised following stakeholder consultations taking place this month.

Deborah Evans, chief executive of the Association of Personal Injury Lawyers commented that there were ‘cases are diverse and liability is invariably denied, which means automatic exit from the portal…if the portal approach is to be extended, sound evidence must be collected to establish what the work actually costs. The process will need to be mapped, costed and then bespoke portals created.’

Government admits it cannot enforce 10% damages uplift

The reality of one aspect of the government’s proposed civil litigation reforms has now become clear. The head of civil litigation funding at the Ministry of Justice, Robert Wright, has owned up to the fact the government is not going to be able to ensure that the planned 10% uplift in accident claim damages levels is indeed applied. This uplift is a critical part of the government’s reforms and is supposed to help compensate those making accident claims with the cost of any solicitor succcess fee or “after the event” [ATE] insurance premium, both of which will no longer be recoverable by a successful injury claimant following the planned changes.

The MoJ have admitted that they will be relying on the courts to make sure this 10% increase is carried through – and for personal injury solicitors to make sure that happens in cases settled prior to the final hearing. I don’t consider myself a cynical person, but this just sounds like caving into insurance companies. Contrary to popular belief, one of the main problems with escalating legal costs in accident compensation claim cases, is the unreasonable approach taken by many insurance companies – who regularly fight claims to the bitter end regardless of the apparent merits of the claim. The government is apparently trusting these self same insurance companies to do the decent thing and to voluntarily agree to pay an additional 10% in the level of damages – which, in the absence of standard compensation levels, is itself an incredibly vague concept.

The winners – the insurance companies.

The losers – all victims of no-fault accidents who deserve compensation, not to say the concept of justice itself.

Government targets fake whiplash compensation claims

Justice Secretary Ken Clarke this week resumed his crusade against “the compensation culture”, laying into personal injury solicitors yet again. Is it my imagination or whenever governments are doing badly, do they seem to look desperately around for easy targets to attack in order distract the public from the governments own failings. So-called ”fat cat” lawyers are often first in the firing line.

According to the government, the number of whiplash injury claims has risen by 70% in just six years and around £2 billion every year is paid out in accident compensation – with GPs apparently claiming that around 25% of the 600,000 compensation claims made every year are either “fake or overdiagnosed”. This is apparently the fault of no-win no fee lawyers. Firstly, if these cases are overdiagnosed, why is it the lawyers fault – they’re not performing the diagnosis – that’s down to GPs and it is the medical profession alone, which is surely responsible for proper diagnosis. But unfortunately attacking doctors is never politically popular – whereas the lawyer, and the accident claim lawyer in particular, is always a popular whipping boy.

The latest news followed earlier claims by the House of Commons Transport Committee, that the insurance industry or did that they’d felt forced to add around £90 to the price of every insurance policy to pay for these fake claims.

Our view? The government is to be applauded if it does in fact successfully set up an independent panel of medical experts to investigate dubious injury claims. But how about making sure that GPs are properly trained and do properly challenge anyone who they suspect of making a false claim. Without medical evidence no sane personal injury solicitor is ever going to run a case – no win no fee or not.

And finally, if the number of whiplash claims is indeed slashed, are we all really confident that the highly profitable insurance industry is going to generously cut down all our premiums ? Apparently the average premium has doubled since 2008 – that can’t just be down to whiplash claims. Will properly diagnosing fake whiplash claims result in a drop of the insurance premiums we all pay, or will any saving somehow be swallowed up in a rise in insurance industry profits. Only time will tell.