- Majority of the public positive about measures to fix the UK’s broken personal injury compensation system.
- Overwhelming view that legal costs are too high.
Most people back Government plans to overhaul the personal injury compensation system, with nearly 9 in 10 thinking that legal costs in the current system are too high, according to an independent survey commissioned by the Association of British Insurers (ABI).
The ABI commissioned the survey as MPs prepare to debate the Civil Liability Bill that aims to simplify and streamline personal injury compensation for low value road accident claims, and reduce legal costs in the system.
Key findings from the survey conducted by Consumer Intelligence highlighted that:
- Nearly 9 in 10 (87%) felt that legal costs were too high. For every £1 paid in compensation, on average an extra 50p is paid out in legal fees.
- Two-thirds feel positive about the proposals to simplify personal injury compensation, including setting up an online process to make a low value claim.
- 71% would be comfortable about making a claim online, rather than seeking legal representation.
- A simple claims process was cited as the most important factor when making a low value personal injury claim by 37%. Ability to claim back legal costs was the least important – ranked first by only 7%.
- Two-thirds surveyed cited a compensation culture environment as the main factor behind the trend of rising motor personal injury claims, despite a fall in the number of road accidents since 2005. This was followed by the activities of claimant lawyers (59%) and claims management companies (58%).
The reforms include increasing the Small Claims Track Limit from £1,000 to £5,000 for road accident personal injury claims; introducing a tariff of fixed compensation for pain and suffering for whiplash claims and developing a simple online process to register a claim.
Leaders of insurance companies representing 93% of the motor insurance market underwritten by ABI members have publicly committed to passing on cost benefits to customers if the reforms are implemented in full.
James Dalton, ABI’s Director, General Insurance Policy, said:
“This survey highlights significant public support for the Government’s plans to reform the personal injury compensation system. There is overwhelming recognition that legal costs are too high and need to be reduced. Most people recognise the benefits of a simple, streamlined system for dealing with low value personal injury claims, that preserves access to justice, and would be confident to use it.
“Reforms in the Civil Liability Bill will mean a fairer system for claimants, motorists and compensators. This is why the Bill’s provisions must be implemented in full, and not watered down.”
-ENDS-
Notes for Editors
Enquiries to:
Malcolm Tarling
020 7216 7410 Mobile: 07776 147667
Sarah Cordey
020 7216 7375 Mobile: 07860 189071
Dominic Stannard
020 7216 7350 Mobile: 07725 245838
2. Consumer Intelligence surveyed 2,088 adults online from 8th – 16th June 2018. All respondents were responsible for arranging motor insurance in their household.
Quoted questions and results:
|
For every £1 which is paid out in personal injury compensation, on average an extra 50p is paid out to lawyers. So, for example, if you won a claim with a pay-out to the value of £2000, lawyers would also be paid approximately £1000. Do you think that this is… |
1 - Far too little |
0% |
9 |
|
2 - Too little |
1% |
19 |
|
|
3 - About right |
12% |
247 |
|
|
4 - Too much |
41% |
858 |
|
|
5 - Far too much |
46% |
955 |
|
|
T2B% |
87% |
1813 |
|
|
Total |
100% |
2088 |
|
|
Average |
4.31 |
||
|
The Government has proposed plans for reforms to simplify the personal injury compensation process for settling lower value claims. This will likely include steps such as introducing an online process to replace the need for legal representation in low value claims scenarios. The reform is estimated by the Government to reduce the price of a yearly motor insurance premium by £35 on average. How do you feel about this proposed reform and the impact it will have on consumers? |
1- Very negative |
1% |
12 |
|
2 - Mostly negative |
4% |
81 |
|
|
3 - I'm not sure |
29% |
599 |
|
|
4 - Mostly positive |
44% |
928 |
|
|
5 - Very positive |
22% |
468 |
|
|
T2B% |
67% |
1396 |
|
|
Total |
100% |
2088 |
|
|
Average |
3.84 |
||
|
Imagine you had to make a low value personal injury claim, to the value of £2000. How would you feel about submitting the claim using a simple online form, which would result in a straightforward settlement process, rather than seeking legal representation? |
1 Totally uncomfortable – I would always seek legal representation |
7% |
141 |
|
2 |
7% |
139 |
|
|
3 |
6% |
115 |
|
|
4 Not sure |
10% |
204 |
|
|
5 |
17% |
363 |
|
|
6 |
23% |
489 |
|
|
7 Very comfortable – I would be happy to use a simpler process to settle a claim |
31% |
637 |
|
|
Total |
100% |
2088 |
|
|
Average |
5.17 |
||
|
|
Percentage ranking option in first place |
||
|
Please rank the following factors in terms of how important they are to you, if you were to make a low value personal injury claim, where 1 is the most important and 5 is the least important. |
A quick pay-out |
12% |
246 |
|
A simple process |
37% |
764 |
|
|
Ability to reclaim legal costs |
7% |
154 |
|
|
Being able to submit my claim online |
13% |
274 |
|
|
Reduced insurance premiums |
31% |
650 |
|
|
Total |
100% |
2088 |
|
|
Thinking about the increase in the number of motor personal injury claims, to what extent do you think that the following factors may be responsible for this? |
||||
|
|
Not at all responsible |
Somewhat responsible |
Largely responsible |
Don’t know |
|
‘Compensation culture’ environment |
2% |
27% |
66% |
5% |
|
Claims management firms encouraging claims |
3% |
32% |
58% |
7% |
|
Increased quantity of cold-calls and texts encouraging claims |
5% |
41% |
45% |
8% |
|
Growth in whiplash- style claims |
3% |
33% |
58% |
7% |
|
Deliberate ‘cash for crash’ motor collisions |
3% |
41% |
47% |
8% |
|
More public awareness that compensation can be claimed for genuine injuries |
6% |
45% |
43% |
6% |
|
Higher levels of public confidence in making a claim |
12% |
48% |
30% |
10% |
|
Increased number of ‘no-win, no-fee’ style lawyers |
2% |
33% |
59% |
5% |
2. The Association of British Insurers is the voice of the UK’s world leading insurance and long-term savings industry.
A productive, inclusive and thriving sector, we are an industry that provides peace of mind to households and businesses across the UK and powers the growth of local and regional economies by enabling trade, risk taking, investment and innovation.
3. An ISDN line is available for broadcast
4. More news and information from the ABI is available on our web site, www.abi.org.uk.