Banning referral fees for personal injury claims in the UK – who is to blame for increased car insurance premiums?

According to the Association of British Insurers, motorists who have been in a road traffic accident are the main cause of increased car insurance premiums.

 

Unfortunately for hurt and injured people, insurance companies are winning the public debate on the so-called compensation culture and last week’s decision by the government to ban the payment of referral fees in exchange for the contact details of road traffic accident victims would appear to vindicate their position that UK motorists are driving up costs by making up spurious accident compensation claims with intent to defraud the system…

 

Are we really to believe that the majority of road traffic accident claims are fraudulent?

 

However, let’s assume for argument’s sake that motorists the length and breadth of the UK are indeed staging accidents for the purpose of making a claim. If it is true that fraudulent claims are costing the insurance industry millions and these costs are being passed on to other motorists we have to wonder why these claims are being settled at all.

 

If the insurance companies know for a fact that the claims are fraudulent why on earth are these people not being prosecuted?

 

Either the insurance companies are happy to pay out on fraudulent claims, lazily pass the costs on to other policy holders and not pursue the fraudsters through the courts, or they have no evidence to back up their core assertion that personal injury claims are the cause of increased premiums. THEY CAN’T HAVE IT BOTH WAYS.

 

We all know how difficult it can be to make a legitimate claim on our own household insurance policy for a genuine accident at home and we all know from personal experience or from talking to family and friends the lengths that insurance companies will go to avoid paying out.

 

Are we really to believe that insurance companies apply a less rigorous test when assessing the merits of a (potentially) costly personal injury claim and deciding whether or not to admit liability?

 

Can it be that insurance companies just don’t like paying out on insurance policies?

 

When making a claim for personal injury following a road traffic accident the injured person has to prove that their injuries were caused by someone else. Without proof there is no claim, period.

 

At Bonnar & Company we very quickly root out any potential accident compensation claims that are likely to fail from lack of evidence. However, injured people can sometimes find it hard to understand that we cannot help them with their claim if we cannot prove that someone else was at fault.

 

It is even harder to take when injuries are very serious and the accident victim has clearly suffered but the fact remains – solicitors need to prove their cases. Otherwise anyone could claim for an injury and the insurance company would just pay up, no questions asked…Wait a minute. Is this not the line we are being fed by the insurance industry?

 

So what is the insurance industry talking about? Simples! The answer is profit, plain and simple. The insurance industry would prefer that nobody made a claim for personal injury and that is why their propaganda machine has moved into overdrive recently to stigmatise hurt and injured people who are already worried about making a claim.

 

Make no mistake we want a healthy and vigorous insurance industry with the financial strength to provide us all with cover but we want a fair insurance industry that will compensate genuine accident victims with as little fuss and bluster as possible.

 

What is an accident victim expected to do? Are we just supposed to grin and bear it when some careless driver runs into us, causing us pain and suffering and forcing us to take time off work…if we’re lucky?

 

What if we’re not lucky? What if we can’t work again? What if we can’t walk again? What if the outcome is even worse for us and by association for our families?

 

Against this backdrop of pain, suffering and loss of earnings the insurance industry has worked tirelessly to paint innocent accident victims as the villains of the piece and make them think twice about taking independent legal advice.

 

Let’s be clear on one thing. A successful personal injury claim is not the same thing as a lottery win. In order to be awarded compensation the successful claimant must have been injured and in order to be awarded a very large sum of money the claimant must have been very seriously injured. Of course not only must the claimant have been injured they have to prove that their injuries were caused by someone else’s negligence.

 

Personal injury compensation is not a guessing game in which claimants and lawyers think of a number and try their luck. Awards are carefully calculated based on pain, suffering and loss of earnings. Despite rumours to the contrary you will not receive a small fortune for a minor injury. It just does not happen.

 

Please also bear in mind that the insurance companies employ an army of solicitors who are not about to sanction a compensation claim without a forensic level of scrutiny. This, incidentally, is the main reason why accident victims need to take independent legal advice.  

 

Assuming an accident victim is determined enough to make a claim for compensation, then the insurance company tries really hard to persuade that person to accept its first and inevitably low offer ‘in full and final settlement’. Insurance companies know the same day and often within the hour, if one of their policy holders has caused an accident and they rush to deal with the claim ASAP often before the injured party has had an opportunity to visit their GP far less consult an independent solicitor.

 

This practice, which is called ‘third party capture’ is endemic throughout the UK and was the subject of a Radio 4 investigation in 2010. Is it fair for multi-national insurance companies to put injured people under intense pressure to settle their claim in the immediate aftermath of their accident? Is this justice? You may well ask why insurance companies rush to settle claims before a personal injury solicitor gets involved.

 

Insurance companies would say that it keeps costs down by short-circuiting the legal process. We would say what about the rights of the hurt and injured to be examined by expert medical professionals and have their claim properly evaluated?    

 

If you are thinking that all personal injury solicitors are ‘ambulance chasers’ you should think about the propaganda that underpins the insurance companies’ position and the fact that it is in their interest to stigmatise both accident victims and their solicitors.

 

But what of the real stigma that rightly attaches to the insurance industry, its PR operation and its legal advisors?    

 

You may wonder who has been receiving referral fees for passing on details of accident victims.

 

One guess?

 

Correct! The insurance industry itself has been pocketing millions over the years and is now portraying its behaviour as ‘squeaky clean’. Admiral Insurance has admitted to earning over £6million per annum from road traffic accident referral fees and one has to wonder what the grand total is across the industry. Our conservative estimate is that the minimum total value of road traffic accident referral fees raked in by the insurance industry is £100 million per annum given the number of insurance companies in the UK and taking Admiral’s ‘take’ as a benchmark.

 

We have not, do not and never will pay an insurance company any money for an accident victim’s personal details. We find the whole idea repulsive as do many of our colleagues in the legal profession.

 

Can we look forward to a reduction in car insurance premiums? Don’t hold your breath but remember the quoted figure of £150 as the average annual saving UK motorists can expect as a result of ‘striking a blow’ against fraudulent compensation claims from car accident victims and their ‘ambulance chasing’ legal advisors.

 

Personally speaking, my blood is boiling at the antics of the insurance industry as it manufactures its own spurious evidence and attempts to stigmatise and disadvantage hurt and injured people at a vulnerable time in their lives.

 

Perhaps, if I look hard enough, I could find a firm of solicitors with no moral compass and no business sense who would be willing to waste their time, money and resources to help me prepare a spurious compensation claim against the insurance industry for ‘aggravated high blood pressure and associated psychological trauma’…or would that be too ridiculous?   

 

Answers on a postcard to the Association of British Insurers.   

Insurance industry blames personal injury victims for rise in car premiums – again

In the fight to dispel the myth of the compensation culture, we need to respond to the latest piece of insurance industry propaganda which received a ‘fullsome and fawning’ full-page leader in today’s Scottish Daily Mail by Ray Massey, the paper’s transport editor.

Lest we fall victim to the insurance industry’s marketing machine, we need to remember that insurance is a business, that the insurance industry can set any price it likes for its products and that we, the public, have to bear the brunt. Let’s be absolutely clear on this – the insurance companies set the prices…and they decide who to blame for the increase.

Why is it that rising premiums are never, ever the result of a decision to increase profitabilty and maximise shareholder value?….They are always BLAMED on something and / or someone else.

Now, read on…please.

Mr. Massey, quotes extensively from an AA (insurance) report:

‘The £1,000-a-year bill for car insurance is round the corner as booming fraud and ‘abhorrent ambulance chasers’ drive up costs.’

Not content with scaremongering on the cost of car insurance, the AA report and the Mail attempt to tar the legal profession as ‘abhorrent ambulance chasers’. Bonnar & Company does not chase ambulances – we and other reputable law firms fight for an accident victim’s right to sue those responsible for their injuries – a principle which is enshrined in law, incidentally.

Accident victims know that compensation is not delivered to them on a plate, as anyone who has ever tried to make any kind of insurance claim will readily appreciate. People have to fight for their rights and without solicitors like us claimants would be at the mercy of the insurance companies who would simply decide what level of compensation, if any, to offer. Is this fair? Is this justice? We don’t think so. 

If the insurance companies had things their way villagers with pitchforks and flaming torches would even now be forming angry mobs to hunt down and exterminate claimant lawyers. Fortunately for the rest of us who pay premiums and actually expect protection, the insurance companies don’t have things all their own way YET – and this is precisely the reason they pump out one-sided half truths like this feature on a regular basis. They are absolutely desperate to stigmatise accident victims and their legal representatives. 

(Just check the archives of the Daily Mail and many other papers to get a flavour of how the insurance industry operates and what they would have us all believe about personal injury solicitors)  

THE REAL HEADLINE IS:      

Insurance companies don’t like paying out on insurance claims!!!

They positively hate personal injury lawyers and that goes double for firms like Bonnar & Company – we are pleased to say. Well who can blame them when we keep giving them a bloody nose – figuratively speaking of course. Well we don’t care and neither do our clients.   

The article continues:

‘The AA says driving up the cost of cover is increasing fraud – including staged ‘cash for crash’ accidents – and more personal injury claims fuelled by ambulance-chasing lawyers and controversial ‘no win, no fee’ claims firms.

Adding to the costs is the ‘black market’ trade in details of potentially valuable accident ‘victims’ which are bought and sold across the insurance industry for tip-off fees of up to £1,000 – a practice condemned by Transport Minister Mike Penning as ‘abhorrent ambulance chasing’ – that phrase again.

A report by the House of Commons transport select committee last month criticised the cash-for-contacts culture that means within hours of an accident, motorists’ personal details are being sold and resold for under-the-counter referral ‘fees’ – to lawyers, medical experts and accident management companies.

Let’s pause for a minute here. Who, exactly is trading details of car crash victims?

The motorists themselves perhaps?

No. How could they and why would they? All they want is their car back on the road fast.

The police?

 Hardly.

The lawyers? 

No. They don’t have details of an accident until someone contacts them…unless they have spy cameras set up at every road junction in the land.

Which leaves…THE INSURANCE COMPANIES!

Think about it. Who is first to get the full details of a road traffic accident?

The report then makes much of the ‘fact’ that ‘Motorists are then bombarded with hard-sell calls from ‘no win, no fee’ firms offering to act on their behalf.’

What about the hard sell calls from insurance companies offering to settle a claim before the victim has had a chance to undergo a proper medical examination? We have seen many cases where clients have been approached directly by the other motorist’s insurance company seeking to settle quickly with a seemingly enticing offer. 

However, the problem here is that if the accident victim accepts the insurance company’s initial and inevitably low offer, that’s it. Even if medical complications arise further down the line the injured person cannot make any further claim. 

The report continues:

‘The AA said despite the number of collisions on UK roads falling, the number of claims for whiplash injuries continued to rise, with more than 200 claims a day, often for accidents from up to three years ago with injuries mentioned for the first time.

The Association of Chief Police officers said there were 30,000 staged accidents in 2009 committed by ‘sophisticated fraud rings’.

Perhaps we should ask the AA to define ‘often’.

Did the police prosecute any, some or all of these 30,000 fraud cases in 2009? 

Undetected fraud topped £930million a year and added an estimated £39 to the average policy.

Eh? Or as we say in Scotland – whit? How on earth does the AA know the value of ‘undetected fraud’

The Scotish Daily Mail article continues:

”The Association of British Insurers warned that motor premiums would continue to soar unless action was taken to curb the cost of personal injury claims. Well they would, wouldn’t they?

Nick Starling, the ABI’s director of general insurance and health, said: ‘The Government’s recently announced plans to reform civil litigation will go a long way to cutting out unnecessary and disproportionate legal costs and should lead to cheaper motor insurance in the future.’

What he conveniently omitted to say was that Lord Young’s Review – ‘Common Sense Common Safety’ stated clearly that there is no compensation culture.

On page 19 of his report, Lord Young wrote:

‘The problem of the compensation culture prevalent in today’s society is, however, one of perception rather than reality.’

Mr. Starling however ploughs on regardless and is quoted as saying:

‘What we now need is a ban on referral fees – where details of potential personal injury claimants are sold on to solicitors and claims management firms.’

What next Mr. Starling? Would a ban on claims be to your liking?

Perhaps Mr. Starling can tell us who is selling details of potential personal injury claimants to claims management companies in the first place?

 

We will no doubt be dragged kicking and screaming back to this subject, but for now we would just like to make four points in conclusion, by way of redressing the balance and injecting some degree of reality and proportion into the debate.

 

1.

The AA report which was quoted extensively in the Scottish Daily Mail article states that ‘despite the number of collisions on UK roads falling, the number of claims for whiplash injuries continued to rise’, which would lead the reader to conclude that car accident claim fraud is rife.However, the Department of Transport’s official ‘Report on Road Casualities in Great Britain – 2008’ makes the point that the number of road traffic accidents reported to the police is only part of the story.

Whereas approximately 234,000 road traffic accidents were recorded in the official police statistics in 2008, the Department of Transport estimates the total number of road traffic accidents to be in the order of 800,000. The full report can be studied on the Department’s website. 

See section 5 of the report for a comparison of police statistics and other sources, which suggests that the vast majority of road traffic accidents do not result in compensation claims…a finding which is in line with a study of accident claims across the board, undertaken by the CAB, which found that over 65% of accident victims never make a claim.

 

2.

Successful claims for accident compensation rely on something called EVIDENCE.

If there is no evidence and in particular, no medical evidence then there is no claim, period. If there is evidence then there COULD BE a claim, but much detailed work still has to de done by the claimant’s solicitor to determine the strength of the evidence and therefore the strength of the case. If the accident victim is partly to blame then the courts will take contributory negligence into account and assess the award of any damages accordingly.

There is no automatic right to compensation and the insurance companies know this, otherwise why would they bother fighting claims? If compensation was a right and all victims had to do was present a ‘claim ticket’ at a High Street cash point there would hardly be any need for lawyers on either side – the ‘right’ is the right to seek compensation, not get it.  

 

3.

Which brings us neatly on to the role of the insurance company lawyers. Insurance companies pay top dollar to big law firms to defend their clients against accident victims’ claims. This is of course a cost which they of course BLAME on the victim, naturally. The insurance company legal team exist to repudiate and minimise the value of compensation claims and if the claimant hasn’t accepted the insurance company’s ‘low ball ‘ initial offer, they will fight tooth and nail over a long period to drag things out and undermine genuine claimants with the aim of making the claim ‘go away.’

This is of course why firms like Bonnar & Compnay exist. Our job is to help accident victims achieve justice and financial compensation. Incidentally, we carry all the up front costs of litigation so that injured people are never out of pocket and have access to the best possible legal representation at no cost to them, no matter how long it takes to force an insurance company to make a fair offer on a genuine claim.   

NB

Bonnar & Company only ever works on behalf of genuine claimants. The very, very small number of potentially doubtful claims that we come across never, ever see the light of day. It is perhaps worth stating that the major headline grabbing spurious claims for mega compensation resulting from apparently trivial injuries inevitably and almost universally always get kicked out by the courts, if they ever get that far that is. However, don’t expect to read in the papers about the downright ‘daft’ or fraudulent claims that fail – they don’t make good copy.     

 

4.

 Why are insurance companies paying out on fraudulent car accident claims?

ARE THEY REALLY PAYING OUT ON FRAUDULENT CAR ACCIDENT CLAIMS, OR ARE THEY JUST SAYING THAT THEY ARE TO MAKE A POINT?

They can’t have it both ways.

Either they are paying out on fraudulent claims which would be an absolute scandal or they aren’t which means there is no problem with fraudulent claims.

Mmmm. Answer on one side of the paper only please Mr. Starling…

 

 

 

 

 

 

 

 

 

 

‘Bananas’ Bus Slips Up In Bridge Crash

A passenger had a lucky escape when a bus hit a low bridge and had its roof sliced off in Edinburgh yesterday afternoon.

The double decker crashed into a rail bridge near Murrayfield Stadium and fortunately the man on the top deck suffered only minor injuries after being thrown into the stairwell by the impact.

Thankfully, the driver and three other passengers on the Go Bananas bus – which is hired out for stag and hen parties – also escaped unhurt.

This incident serves as a prime example of the need for the proper risk assessment of business activities involving members of the public and highlights the dangers of the wholesale watering down of safety standards recommended by Lord Young in his recent ‘Common Sense Common Safety’ report to the government. In his report Lord Young proposed to remove the burden on business by removing the statutory requirement for formal risk assessment across a wide range of commercial and not for profit enterprises because he believed the they were not inherently dangerous and that a proportionate response to health and safety risk was needed.

If a group of guys or girls had been upstairs on this bus at the time of the crash there would have been multiple fatalities and the tabloid press, quick to demonise accident victim compensation claims, would have been clamouring for evidence of route planning, driver training and of course, risk assessment…

Let’s hope the lesson has been learned by all concerned with this incident and that other private and public operated bus operators in Scotland take note that the health and safety of their passengers has to be their prime responsibility. Health and safey legislation is not a burden on enterprise it is a positive engine of business value, not least because the costs to the insurance industry are reduced if we all take care on the roads and elsewhere. At least on this ocassion we are not looking at wrongful death claims in addition to bus and bridge repair costs.

If you have been hurt or injured in an acident on public transport in Scotland within the last three years, please contact us for a FREE no obligation legal review of your case on 0800 163 978.

Scottish police warn plan to cut speed cameras will risk lives

Scotland’s top police officers have said they would be concerned if funding for speed cameras became a victim of government budget cuts.

The Association of Chief Police Officers in Scotland (Acpos) spoke out toady after its sister organisation claimed lives would be put at risk as a result of UK Government spending cuts to the network south of the border.

Mick Giannasi, who leads on road policing for the Association of Chief Police Officers (Acpo), which represents officers in England, Wales and Northern Ireland, said he was trying to persuade Conservative and Liberal Democrat ministers to protect the cameras “for the future of our road safety”.

Last month it emerged that Oxfordshire County Council was switching off all 72 of its fixed speed cameras as part of moves to save money, with other local authorities south of the border are also considering similar action. The UK Government cut £38million from this year’s road safety budget and ended central funding for speed cameras.

Julie Townsend, deputy chief executive of road-safety charity Brake echoed the calls. She said: “We agree with Mick Giannasi that if we do see speed cameras removed on a large scale, which seems likely to happen, it’s going to be a devastating blow to road safety. We know that cameras are very effective in cutting speeding which is vital for protecting all road users.”

Having seen the devasting results of reckless driving, Bonnar & Company echoes the views of road safety expertsspeed kills.

If you or a member of your family have been involved in a road traffic accident caused by a speeding driver please contact our personal injury specialists for FREE expert legal advice and practical assistance. For a no obligation review of your claim please call freephone 0800 163 978. 

Road safety charity hits out at savage budget cut backs

In the budget today, it was announced that transport funding is likely to be cut by more than 25% by 2014, causing concern for the future of life-saving road safety measures.

Brake, the Road Safety charity, believes that these measures will contribute to a rise in casualties and consequential costs to the emergency services, making such cut backs a false economy.

There is to be an immediate cut to the road safety budget for the current year (2010/11) by a catastrophic 40%, made up of a 27% cut to the revenue grant of £20.6m and a £100% cut to the capital grant of £17.2m. The capital grant is used for road safety engineering measures such as pedestrian crossings and installation of fixed cameras and speed humps. The revenue grant is used for local authority-led local road safety partnerships, which carry out campaigns and education, particularly of young people, who are more likely to die on our roads than die from any other cause or illness and for costs such as maintenance of speed cameras.

Despite the cutbacks, the Department for Transport does not expect there to be a direct correlation between the savage grant reductions for road safety and local authority expenditure on road safety, saying it is for local authorities to decide where their priorities lie across all their responsibilities and they are free to swap funding from one area to another.

One road safety officer told Brake: “The major loss of funding this year, and the uncertainty of continued funding at all, may well result in the discontinuation of road safety partnerships with nothing to replace them. Road safety has been dropped and we can expect to see the death toll rise as a direct result.”

Ellen Booth, campaigns officer for Brake, said:

“Brake is outraged that road safety has been targeted so brutally – traffic is the biggest killer of young people and dangerous behaviour on roads causes thousands of horrific deaths and injuries of all ages every year in the UK. By targeting road safety, the government has shown they have no concern for the families of the future carnage we may see because of this irresponsible and short sighted cut of a vital life-saving service, and also no understanding of the enormous expense to the emergency services of road crashes and therefore the false economy of making these cuts.

The government has sent a very powerful message to local authorities that life saving work in road safety is not important at all.”

Bonnar & Company is all too familiar with the results of careless driving and poorly maintained roads and we are horrified by the government’s proposals. Most people would expect a new government to make safety on the roads a priority but it seems that we are being softened up for more swingeing cuts to health and safety expenditure across the board and that we can expect no favours from Lord Young’s forthcoming review.

If you have been hurt or injured in a road traffic accident and would like an expert legal review of your case at no charge, please contact us on FREEPHONE 0800 163 978.