Maxwell Scott: Premiums will go up, not down
The time cases brought through the Official Injury Claim (OIC) portal take to settle has increased by nearly two-thirds over the past three months, new figures have shown.
The OIC data for the first three months of 2022 continued key trends seen since its launch on 31 May 2021, in particular that fewer than 10% of claimants are litigants in person (LiPs).
Only 17,607 of the 209,442 claims lodged since launch have settled so far, most of them in the last three months, and the average time from claim to settlement was 139 days, up from 85 days in September to November 2021 (reporting has jumped December to bring it in line with the usual quarters).
The OIC stressed: “Settlement data will take some considerable time to mature, and a more settled picture is unlikely to emerge before the end of 2022.”
The early data showed that 66% of claims were settling within the first three tariff bands, ie claims for an injury with a duration of up to nine months. The OIC said it expected to see claims falling into higher bands as time elapsed.
The data also indicated that LiPs and represented claimants were agreeing similar levels of compensation: the former have received an average of £666 for tariff injuries, £446 for non-tariff injuries and an uplift of £30; for the latter, the figures were £655, £420 and £15.
Last month saw the highest number of claims submitted (26,436). The OIC said: “In recent months there is an average of c.25,000 claims per month. These figures should not be viewed in isolation; claims are still correctly reporting into the Claims Portal Ltd regime.
“There are significant non-service factors influencing driver behaviour and accident rate. These include the impact of Covid-19 as well as the general economic factors of cost and inflation that will indirectly influence vehicle miles and vehicle parc [the number of vehicles] and ultimately accident rate.”
Some 9.7% of claimants in the first quarter were LiPs, up only marginally on the last set of data.
Other recurring figures were that only around a third (32%) of claims were covered by the whiplash tariff.
There remains no news on the plan to expedite test cases to the Court of Appeal for guidance on how mixed claims – cases with both tariff and non-tariff elements – should be handled.
LiPs remain significantly more likely to seek an uplift for exceptional injury, exceptional circumstances or both – 38%, compared to 23% of represented claimants.
They are also more likely to see liability admitted in part or in full – 94%, compared to 83% of represented claimants.
Of the claims that have exited the portal, just 250 claims have done so to head for a court hearing. Complex issues of law are the main reason for portal exits, for 42% of represented claimants and 32% of LiPs.
Matthew Maxwell Scott, executive director of the Association of Consumer Support Organisations (ACSO), pointed out that OIC claims volumes of 74,202 in the first three months of 2022 compared with Compensation Recovery Unit data of 107,463 in the equivalent period in 2021, at the height of lockdown.
“An urgent rethink is required in order to prevent complete sclerosis in the civil justice system,” he said.
“The OIC was meant to make it easy for injured people to settle their claim, but this self-evidently is not happening. As a result the justice system, already creaking from record court delays, risks falling over a cliff.
“Meanwhile the chapter in the government’s latest data report on ‘system operation’ borders on the Panglossian. It claims the OIC is working ‘as expected’ when professional users report huge issues and unrepresented claimants are having to turn to the support centre in ever-increasing numbers.”
There has been a significant spike in calls by LiPs to the support centre so far this year, the 5,429 received only a little short of the 5,821 received in the seven months of operation last year.
Mr Maxwell Scott reiterated his call for the Ministry of Justice to establish “a cross-sector change control committee” made up of technical experts, rather than the policy people on the existing OIC advisory committee, “with the power to make the recommendations necessary to get the OIC to the point where it is fit for purpose”.
ACSO members backed the call. Mark Savill, managing director of Bristol law firm Lyons Davidson, said: “As the data continue to show, current oversight of the portal is not working. The next set of data will take us to an entire year since launch, but I have no confidence that anyone will be able honestly to claim it is near to being fully operational.
“Despite repeated assurances that the developed platform is stable we continue to receive system and data dictionary changes with little notice as the MIB grapples with issues that remain.”
Mr Maxwell Scott added: “The problems with the OIC are adding to the cost of motor claims; the opposite of what ministers intended. The promised £35 reduction in car insurance for the public as a result of the reforms is now further away than ever.”
Sue Brown, chair of the Motor Accident Solicitors Society, argued that the “dramatic” fall in the number of claims compared to previous years “cannot be attributed to the impact of Covid-19 and general economic factors, but must be associated directly with issues around the OIC and the new claims process”.
The data “strongly indicates that many accident victims are either unsure about how to make a claim, are reluctant to make a claim without representation or are unable to pursue a claim through the OIC”, she went on.
“All of these conclusions carry concerns about the structure and fairness of the new claims process and need to be investigated thoroughly.”
Andy Cullwick, head of marketing at First4Lawyers, said: “The Ministry of Justice has tried to brush off the underwhelming statistics as teething problems, but that’s wearing thin nine months in and with no sign of improvement.
“Rather than eliminating fraudulent cases, could the fall in claims be down to the disastrous system which has proved so complicated to use that people instead choose not to bother? We simply don’t know.
“What we do know is that it has failed from day one and if those in charge are genuine about delivering access to justice, they will accept responsibility for its failure and take urgent steps to try and fix it.”
Matthew Maxwell Scott and Sue Brown will be among those on an expert panel at our PI Futures conference debating the first year of the OIC portal. The Ministry of Justice and MIB will also be represented. The event takes place on 25 May in Manchester. See here for all the details.
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