Jack Straw aimed a kick at the wrong target when he bemoaned activities of claims companies and lawyers in referral fee investigation.


Thus, at a stroke, Djanogly kicked into touch the key finding of Lord Young’s 2010 report on the Compensation Culture (see our other blog posts) i.e. that there is no compensation culture (page 26 of the report) – it is the figment of the popular press’ imagination, aided and abetted by the insurance industry. 



Mr. Straw, the Labour MP for Blackburn, said the scandal was hitting ‘perfectly law-abiding people’ with sky-high insurance costs…


and what about the perfectly law-abiding people who will find their access to justice cut off?


Mr. Straw, whose own investigation (bit of a ‘cult of Jack’ going on here) into how even the police are taking tip-fees, prompted the select committee to re-open its earlier enquiry, said: ‘What I am clear about is that of a total of about £9billion premium income, £2billion is costs caused by people who can be accurately be classed as the parasites in the system.


How is he clear about this again? Didn’t HE read Lord Young’s report?


Mr. Straw told MPs that the previous night, while he was preparing his evidence to the committee, he had been phoned at home by a claims accident company seeking to represent him over an alleged accident  in the last three years: ’I’d not had an accident in the last three years,’ he told MPs.

‘But it shows the relentless pressure inside these very dodgy firms.’


Yes Jack, but you like countless others did not claim, nay COULD NOT CLAIM BECAUSE YOU HADN’T HAD AN ACCIDENT – GEDDITT?


Mr. Straw added: ‘Claims management companies are parasitic. In any other walk of life, we would describe this racket by referral companies as bribery.

‘These practices are leading to very substantial (insurance) increases on law-abiding motorists.’


Jonathan Djanogly said the Government intended to band the ‘merry-go-round’ of referral fees which have sent premiums rocketing.


He noted: ‘You only have to turn on daytime TV to see lots of dodgy solicitors’ firms which are part of this racket.’ He said there were two firms of solicitors within 100 yards of his own front door offering ‘£600 for a referral.’


Memo to Justice Secretary:

If dodgy solicitors are advertising on tv, then bring them to justice now!! Haven’t you heard about the Advertising Standards Authority?


Justice Minister Jonathan Djanogly told the committee the Government’s decision to ban the ‘merry-go-round’ of referral fees was ‘appropriate’ and had been ‘generally welcomed’.


Referral fees were part of the ‘sick, suing culture’ that was keeping premiums artificially high: ‘We want the benefit to feed through to the consumer in the form of lower premiums.’…and fair compensation settlements!!! 


He believed the Government’s reforms would bring commons sense to the system by weeding out greedy claims, noting how under the current system: ‘If you are a claimant and have no chance of losing, you are almost crazy not to sue. Why wouldn’t you? That’s what we propose to reverse.’ 


This is getting rather tiresome. Will somebody PLEASE tell the UK Justice Minister that an injured person wishing to make a claim has to actually prove negligence? Ye gods – does he think that people claiming compensation just have to ask the insurance companies nicely?


Keen to get in on the act, or is it the feeding frenzy, roads Minister Mike Penning condemned the claims firms as ‘ambulance chasers’ noting: ‘As a human being I find it very difficult that any organisation would seek to profit from others’ injury. Yet fifty per cent of claims are personal injury claims.’ 


This comment is about as crass and unthinking as it is possible to get, even for a government minister.


Critics say soaring premiums are tempting some to drive uninsured – with an estimated 1.3 million drivers now on the road without insurance.


A word anyone about insurance company profit margins or their active participation in and encouragement of referral payment schemes?


MPs on the Transport select committee report have already condemned the current system as ‘dysfunctional’. We take it they mean the claiming ‘thing’ and not Mr. Djanogly’s department…although that story isn’t over yet, not by a long way.


Paul Evans, chief executive of insurance company AXA UK, said increases had slowed to about a 1 to 2% rise a month but added:’ we shall continue to see continuing increases in the months to come


aye right enough, as he squeezes every ounce of profit out of claimants before his game is rumbled by a myopic government and an enraged public who aren’t as gullible as he thinks.