Personal Injury Claims Referral Fees
Personal injury referral fees are in the headlines once again linked what has become commonly called the “compensation culture”.
As the Association for Personal Injury Lawyers makes plain, the so-called “compensation culture” does not reflect the reality of the claims environment. The number of claims notified to the Government’s own Compensation Recovery Unit has not increased vastly over recent years. However, it does suit insurers for the public to believe that there is a greatly increased “compensation culture” because this is used to justify increased policy premiums.
Referral fees have been permitted for some years: solicitors pay for referrals and this has led to the mushrooming of claims management companies which, within insurers themselves and motoring organisations, acquire and sell on claims. Often claims management outfits will mislead the injured party, saying that they must use a particular panel solicitor and/or that the intervention of the claims management company will some how assist with the claim. In practice it is very hard to see how this is true.
Anyone, however injured, will be vulnerable and the suggestion “we’ll take care of everything - leave it to us” is tempting. Where the injured person is not to blame, their claim is a commodity possibly worth several hundred pounds to an insurer or claims manager.
The downside of accepting the claims manager’s offer is that the lawyers dealing with the claim could well be anywhere in England or Wales. It may be virtually impossible to speak with the person dealing with the individual claim or there may be a team of people working on each claim none of whom has final responsibility. There are “claims factories” where there is a claims “production line” and the injured party may receive little information or understanding of the process.
The “factory” system may work satisfactorily for a trivial injury with a fast and full recovery, but for anything more face to face personal contact is much better and should provide more peace of mind. Clients should receive clearer explanations and a betterunderstanding of what is going on, including support for each stage of the process and advice about what should happen next. The end result should be that the client feels in control. But importantly, as well as increased peace of mind there could well be a positive effect on the size of the final compensation payout.
As a member of the Law Society’s Personal Injury Accreditation Scheme and a Senior Litigator with the Association of Personal Injury Lawyers I would recommend anyone unfortunate enough to be injured in an accident caused by someone else to choose their own local solicitor and go direct. It is not true that there is not freedom of choice and that you have to use someone else’s panel solicitor.
For further information please contact James Browne on 01392 66677 or e mail him direct on jamesbrowne@stones-solicitors.co.uk
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