Will MP report help bring down whiplash claims?

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Whiplash accounted for 70% of all injury claims in 2010-11
Whiplash accounted for 70% of all injury claims in 2010-11

Specialist transport legal firms give mixed reaction to TSC report – but agree costs remain too high to fight claims

Transport solicitors have expressed doubt as to whether the Transport Select Committee’s (TSC) proposals to restrict the number of subjective whiplash injury claims will result in an overall drop.

The TSC report published last week as a follow up to their report last year on the cost of motor insurance says claimants should provide much more evidence they have suffered a whiplash injury and of subsequent inconvenience.

The MPs also want insurers to be banned from selling any customer information. The government intends to ban them from receiving referral fees for this data, but only for personal injury claims.

Louise Ellman, chairman of the Transport Committee, said: “Insurers, solicitors and claims management companies have themselves driven up the cost of motor premiums by encouraging people caught up in road accidents they did not cause to claim for personal injury, car hire, and other legal costs.”

“The insurance industry must abandon sharp practices that push up premiums such as passing drivers’ personal data to other parties or taking secretive referral fees from solicitors, garages and car hire firms,” she added. Ellman said whiplash accounted for 70% of all injury claims – amounting to roughly 554,000 whiplash claims in 2010-11.

“The threshold for receiving compensation in whiplash cases should be raised and, if the number of such claims does not fall significantly, the government should bring forward primary legislation to require objective evidence – both of a whiplash injury and of it having a significant effect on the claimant’s life – before compensation is paid,” she concluded.

Richard Pelly, director of Pelly’s Transport & Regulatory Law told CBW: “Operators will welcome any initiative which means that only valid cases can be pursued and which leads to an increase in the scrutiny and control of low-value claims. Whether or not any government proposal will have a direct impact on fraudulent claims remains to be seen, but low value claims (whether they are fraudulent or mistaken) can be hard to disprove and expensive to defend, so we hope the government initiatives will help slow the progress of the so-called compensation culture.”

David Milton, an associate at Stone King LLP Solicitors said: “We mustn’t lose sight of people with valid claims. Whiplash is fully diagnosable and some clients will have symptoms for the rest of their life, as a result of someone else’s negligence. To dismiss neck injuries ‘as a bit of whiplash’ could be seen as insulting.

“As part of each and every claim an independent and well qualified medical expert will carry out a formal examination and tests and give their professional opinion as to whether or not an injury has been suffered as a result of the accident – they may also recommend scans or x rays which would provide further evidence of any injury and assist them in reaching a prognosis”.

Milton said claims can always be challenged, commenting: “Bus companies or insurers who genuinely think someone is trying to make a fraudulent claim, can challenge or put questions to the medical expert, or can formally allege fraud. The legal burden of proof would be on the bus company or insurer to establish the fraud.”

Milton also added that since the introduction of the Civil Procedure Rules in1998, all medical experts must sign a declaration to say they are entirely independent of either party – their reports have to be addressed to the Court. “If a consultant were found to be biased, he or she wouldn’t get any more work,” he added.

Milton concluded: “I can’t overall see the number of claims going down. The spotlight should be on the insurers and claims management companies. It must also be borne in mind that in reality it is often in my opinion the insurers which lead people into claiming following an accident – people who might not have claimed. Most insurance policies will have legal expense cover bolted on as standard, and the insurers are usually keen for injured parties to take advantage of this and claim for their injuries, so the insurers can then pass the claim on to one of their panel solicitors for a nice referral fee, which can be as much as £800 per individual case.”

Meanwhile, Alexa Hornsby, head of Backhouse Jones’ insurance litigations department, told CBW the select committee’s report should help the position on whiplash claims. “We get so many of these whiplash claims – a lot are fairly low value and all are really quite subjective,” she said.

“A claimant will go for a medical report a few months after the incident and by that time, there are no symptoms left; a report will be carried out on that basis.

“The cost of defending the claim is disproportionate to the value of the claim. There are all the associated costs of referral fees – there are so many hidden costs floating around; it has become a huge industry.”