The year ahead


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David Johnson, President, Forum of Insurance Lawyers (FOIL) and large loss


partners at Weightmans LLP The Government’s reform spotlight promises to remain firmly trained on the insurance sector in 2014 as the drive to control claims continues apace. There may also be further specific developments around fraud to address wildly inflated personal injury


claims. Last November, Justice Minister Shailesh Vara indicated that the Government would be clamping down on fraudulent and exaggerated claims. The hope is that the courts will be encouraged to adopt a tough approach and strike out claims in their entirety if claimants are engaged in gross exaggeration. The progress of EL and PL claims through the portal will come under scrutiny and analysis in 2014.


There’s also been speculation that a credit hire portal may be launched, though developments on that front will need to be careful monitored in the wake of the Competition Commission’s interim review of private motor insurance. Personal Injury lawyers are going to have to watch closely to see whether the tough imperative set by the


Mitchell judgment is reflected in the way the wider judiciary approaches case management on a day-to- day basis. Disease lawyers will also have profound changes to cope with come July, when the tariff scheme for mesothelioma claimants who cannot trace an insurer will start and the extension of the LASPO funding provisions to include mesothelioma claims comes into effect. Qualified One-way Cost Shifting will then apply in such cases and success fees and ATE premiums in mesothelioma cases will no longer be recoverable. Not much stood still in 2013 and one is left with the impression that 2014 heralds a similar pace of change.


Craig Budsworth, chairman of MASS and partner at Garvins Solicitors The wish list for the next 12 months has to be headlined by one thing: time to bed in. The last 12 months


have seen so much change that the worry is that sufficient time will not be given for them to bed in and the consequences of those changes assessed. I've said in the past that the real impact of the changes to costs will not be felt for 12 months because of the impact on the post issue fees that insurers will not be paying yet. What is being felt however, is the reduction of claims. When you look back at the consultations of 2013,


they were two-fold – one to reduce the number and secondly reduce the costs of whiplash claims. The Transport Select Committee had asked the Government to comment on how insurers are going to reduce premiums and how this will be monitored. Perhaps another key question should be, “What number does the Government expect claims to fall by?”


If the Government had said to insurers in February 2012, we will introduce these changes and if we will see a 20% drop in claims, a 60% reduction in costs, plus fixed costs post issue that hasn't yet been quantified, a combined saving in excess of £2 billion, then what impact will that have on premiums? If this had been asked then we would now know where to expect the average premium to be. As much as I've said we need to bed in these changes there is an awful lot of work to be done during the


next 12 months with further change. Early in the new year there are planned round-table meetings about medical panels that will probably see them introduced for the start of 2015. On top of this, with our friends at the ABI, we will be looking to have in place some data exchange that will help reduce the opportunity for fraud. This is not going to happen by itself but this further change should make everybody involved in the industry feel that it is more reputable and robust whilst still protecting the rights of accident victims. Oh, one last thing, a holiday when it's all over! ●


30 /Claims Magazine/Issue 11


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