In January 2019, Equities.com published an overview of the personal injury market in the United Kingdom. It confirms the personal injury law sector faces considerable headwinds over the next year or so, with the passing of the Civil Liabilities Act 2018, raising the small claims limit for personal injury from £1,000 to £2,000, and to £5,000 for RTA-related claims.
And then there is the not inconsiderable market uncertainty brought about by Brexit as large chunks of our health and safety and worker’s rights laws derive from EU directives. This may also pose challenges in relation to personal injury claims for injuries abroad and defective products. Although Ministers have committed to retaining the existing legal rights British people currently enjoy after we leave the EU on 29 March 2019, the fact is the government will no longer be bound by EU rules and regulations and is free to change laws as it sees fit. Workers rights are seen as particularly vulnerable to such moves.
But despite these challenges, opportunities abound for law firms who wish to grow their personal injury practice or take on a personal injury specialist to launch a new department. RTA claims are on the rise and this is likely to continue as claimants’ race to make a claim before changes to the law occur. In addition, areas such as clinical negligence and abuse continue to grow.
The overview covered the main classes of personal injury claims in the UK: motor, public liability, employers’ liability, disease, abuse, and clinical negligence.
Motor vehicle claims
The number of road traffic accident (RTA) claims increased in 2018. A further increase is expected to be registered in 2019, especially in young drivers.
RTA claims is another area where Brexit may have a significant impact. The overview pointed out that more than 170 EU motor-related Directives were issued since 1973, covering subjects as diverse as sound and emission levels, windscreen wipers, and washer systems, and seatbelts. The EU Motor Insurance Directives made it easier for Claimants to achieve success in situations in which the driver was at fault. According to the Chartered Insurance Institute, Brexit could result in a strict limitation on damages awarded to non-UK citizens injured in the UK to the levels of damages they would receive in their country of origin.
Public liability claims
2018 saw a slight overall reduction in public liability claims. Statistics show the repudiation rates have increased with around 10% in 2018 and this is expected to rise by another 5% in 2019 due to technological advances increasing the chances of detecting fraudulent claims.
Due to the greater care shown for employee safety, claims for employer liability continue to decline. It is believed this trend is likely to continue, especially in the manufacturing sectors, where advances in automation and robotics continue to replace human labour.
The number of claims related to disease have increased by around 140% since 2014. Many of these claims were asbestos claims, which are expected to continue at current levels before declining from around 2020. Equities.com cited a possible explanation for the increase in claims which it believes could be related to hearing loss cases; specifically, the fact that insurance companies register hearing loss claims even if the loss does not exceed 50 dB in one or both ears.
Statistics show that compared to the volume in 2012 and 2013, sexual and physical abuse claims have reached a “new peak”. Many claims include ‘grooming’ and historic abuse suffered by vulnerable children in the care system. In addition, historic sexual abuse in boarding schools has garnered media attention, in part due to the bravery of writer and investigative journalist Alex Renton, who wrote a detailed account of the abuse he suffered at Ashdown House in 2014 which resulted in many victims of historic boarding school abuse having the courage to come forward.
Clinical negligence is also increasing numbers of claims according to the overview by Equities.com. Between 1 January and 31 March 2018, over 5,000 clinical negligence claims were registered. The NHS Resolution 2017/18 annual report and accounts showed that damages paid to claimants have also risen significantly; however, 69.6% of cases were settled outside of court.
Despite the uncertainty surrounding Brexit, figures show that there is plenty of scope for growth in a firm’s personal injury department. Aside from disease, clinical negligence, and RTAs, another area in which claims have increased is that of historical physical and sexual abuse. Working with partner specialising in law firm finance will help increase your law firm’s casebook with claims which deliver not only a strong financial return but help enhance your reputation as an expert in the field.
To find out more about how BMS Funding can assist with law firm finance options, please contact us on 0333 212 7151.