This article first appeared in Modern Claims Magazine Issue March 2016
If George Osborne had announced in his Autumn Statement that the Government intended to ban shopping to prevent shoplifting, or to ban home contents insurance because there is evidence to indicate that some people claim to have been burgled when they have not, the reform is unlikely to have been welcomed. Shop owners and insurance companies might have some objections, and law-abiding people do not regard it as acceptable that their rights and freedoms should be removed to prevent the fraudulent activity of a criminal minority. Yet it appears the Chancellor’s announcement of an intention to remove the right to damages for whiplash from all accident victims because an unquantified minority make fraudulent claims has been widely welcomed, at least among those sections of the press where the myth that whiplash is not a genuine injury has taken root.
The Autumn Statement somewhat took the wind out of the sails of the Insurance Fraud Taskforce, and must have necessitated some last-minute re-writing of their report, which was published on the 18th of January. The report is a mixed bag of sensible comments and recommendations and misguided and naive ones. Of course pre-med offers, which more than anything else have driven a perception that compensation for whiplash is “easy money”, should be discouraged. But the notion that by requiring a dishonest solicitor who has paid an unlawful referral fee to a CMC and may, if insurers are to be believed, have submitted a claim notification form without the claimant’s authority, will suddenly be struck by the error of his ways when faced with a field in the CNF requiring him to name his referral source is less sensible. As for the proposals to introduce special rules for those claimants who do not present claims promptly after an accident, they would if introduced achieve nothing other than to complicate the law in an already difficult area, and disadvantage claimants who have perfectly valid reasons for deferring bringing their claim. The behaviour it is intended to address, the mining of data that leads to claims being generated by cold-calling years after an incident, is already unlawful, as is the purchase of those claims by solicitors. At least the Taskforce acknowledges this elsewhere in the report
The scathing criticisms levelled at solicitors, CMCs and other sectors may or may not be justified, but the report cannot be regarded as a balanced document where it merely recommends that insurers improve communication and make greater use of behavioural economics.
I represented MASS in the personal injury group that advised the Taskforce. The three insurer/defendant lawyer representatives and the three claimant stakeholder representatives in the group had very constructive discussions, and we put forward some unanimous recommendations that we believed could bring about real improvements. Most of them were adopted by the Taskforce. They certainly did not however include a recommendation that the right to damages for minor whiplash be removed.