Sunday, May 04, 2008

Why not all claimants are "money grabbers"

A recent survey by legal superpower Russell Jones and Walker (RJW) revealed predictably that most people believe that personal injury claimants are "Money grabbers" and that the UK is heading for a US style compensation explosion.

This kind of crap was peddled back in 1999 /2000 when Claims Direct -CD- were in their pomp. (CD as a brand is now owned by RJW as it happens). Back then it was all doom and gloom so far as the PI world was concerned. Claims Direct were about to float on the stock market and the liberal do gooders came out of the woodwork to stir up negativity about the personal injury business.

This was a very important time for the industry because in 2000 the concept of "No win No fee" was formally introduced into English & Welsh law and legal aid was all but abolished for personal injury cases (medical negligence being the only type of claim now publicly funded). At the time I have to say that most in the know feared that we would rapidly go downhill transforming a once honourable profession into an industry that would be largely despised, inviting frivolous claims in vast quantities just to make a fast buck.

The demise of CD and of course The Accident Group changed all that. The legal system basically scuppered their business models mainly because they were based on excessive ancillary fees and admin expenses underpinned by dirt bag claims. The cleansing process (which involved a series of precedent setting court cases) was disasterous for the two businesses but cathartic for the industry.

The reason I raise this again now is that the RJW survey reveals that public opinion is no different now to what it was in 2000 despite the cleansing process we have undergone.

People generally hate PI lawyers and those that try to make money on the back of their claim. Most of the haters are those who have never and would never (in their eyes) make a claim.

One of the most common remarks I hear from claimants is "Im not one for making claims" or "I never thought Id do something like this"

It always makes me laugh because you would think that they were being asked to jerk off in public or something.

Now this leads me back to the central question. Are people who make claims really money grabbers?

Well here's my take

Its very much dependent on what sort of accident you are dealing with

Because of the way insurers plug personal inury claims (they get huge kick backs for passing them on to panel solicitors) I would say at least 40% are "dirty" claims that are made by people on the make. The rest are genuine and deserve compensation.

EL (Employers liability)
Here the dirty % is far less simply because - when you claim against your employer for an injury suffered at work - its a pretty tough thing to do. You are slinging mud at the guy who pays your wages. Not easy and it definitely not for the money grabbers

That said money grabbers who hate their boss - well thats a different story. Id say around 20% of claims are dirty

PL (Public liability)
This legal area incorporates the much maligned and extremely difficult to win tripping claims and similar case types. Here your solicitors are more likely to weed out wastrels before they get to first base. Dirty quota 20%

In real terms - most people are genuine and only RTA claims involve a heavily skewed % of money grabbers. The system has allowed people in that sector to flourish and the same insurers who whinge about rising claims costs are also more than happy to take a slice of a referral fee (up to £500) for passing new cases to selected solicitors.

My final thought on this is quite simply that NO GENUINE PERSON ever wants to make a claim. But if you get hurt in an accident your view on the morals of making such a claim will change immediately. You will make a claim and lets be reasonable - why the hell should you feel bad about that?


jmw said...

As an avid reader of your blog Mr Spy I can say that I generally agree with most of your posts about the cynicism surrounding the injury claims business.

But I dont share your views re the % of so called wasters who might be prone to making a whiplash claim

The system does make it rather easy for them but frankly - even money grabbers wouldnt put up with the trouble you have to go to in order to sign a no win no fee agreement etc and then attend an examination with a doctor.

Its rather more difficult to accept what you are saying when you deal with these people day in day out. The vast majority are NOT simply after a few quid

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