Since 2009, one of Britain’s major insurers has made over £100 million from selling accident victim cases to lawyers, but what does this mean for your genuine personal injury claim?
As a driver who has sustained an injury in a crash, you may feel like you are entitled to some sort of payment from the guilty party – and it’s likely that you are. To confirm the strength of such a claim, always seek the advice of an independent and long-established personal injury solicitor.– never rely on a text message received on your phone out of the blue.
Insurers often sell your personal injury case to the highest bidding lawyer and make an initial profit on your accident. This payment will no longer be lawful beyond April 2013.
The referral fee system has forged a lucrative income stream for insurers since 2004 and now, with the walls closing in, insurers are looking at alternative ways of making the same amount of cash.
The term alternative business structure (ABS) refers to outside of profession ownership of solicitors practices. Some insurers plan to create an ABS to continue making profit, and to replace referral fee income.
It is all at a rumour stage and until the ban actually comes into force, there is no telling how the insurance industry is going to respond. One thing is for certain - they will not be easily giving up a £100m profit (amount based on the three-year total between 2009-2012).
Motor accident fraud is the prime sector for fake claims in the UK and has risen by nearly 10% since 2010, according to the Insurance Fraud Bureau. Whiplash fraud is a particularly big concern for the insurance industry but at the same time, a lot of minor neck injuries are preyed upon by insurers, who encourage the ‘injured’ driver to make a claim – indirectly encouraging fraud against them.
Britain’s independent and professional solicitors condemn the practice but are often mistaken as its instigators. John Spencer of Spencers Solicitors in Derbyshire only secures whiplash compensation on behalf of authentic sufferers. His latest view on the topic was documented in his personal blog this month:
“…an unruly bandwagon is being piloted by an alliance of insurers, government and certain newspapers to convince us that whiplash is an invented condition. If the bandwagon isn’t stopped, it will career into whiplash victims and ruin their ability to obtain redress.”
Spencer is turning the attention back on those who are injured, potentially long-term, through no fault of their own. He considers it every claimant personal injury solicitors’ duty to seek to protect those who suffer whiplash caused injury and believes all involved in the legal system share in that duty.