“Today accident victims are given the impression that they may be entitled to handsome rewards just for making a claim regardless of any personal responsibility – adding to a real sense that we live in an increasingly litigious society…Britain’s ‘compensation culture’ is fuelled by media stories about individuals receiving large compensation payouts for personal injury claims and by constant adverts in the media offering people non-refundable inducements and the promise of a handsome settlement if they claim.”
So said Lord Young of Graffham in his report ‘Common Sense – Common Safety’ following his review, commissioned by the Prime Minister, of the operation of health and safety laws and the growth of the perceived compensation culture in England & Wales. The Ministry of Justice quote examples of advertising by claims management businesses that promote inducements and which are currently permitted:
“We’ll pay you £200 immediately after our solicitors approve your claim.”
“As soon as we accept your claim, we promise to give you a £150 cash advance.”
“If the solicitor believes they can win the case for you and accepts it, we will award you £300 as an up-front payment.”
The Ministry intend to put a stop to all this by preventing claims management businesses from offering any kind of financial or similar benefit as an inducement for making a claim at any stage throughout their dealings with a client. The proposal is to amend Rule 6b of the Conduct of Authorised Persons Rules 2007 by deleting:
“6. In soliciting business through advertising, marketing and other means a
business must –
b) Not offer an immediate cash payment or a similar benefit as an inducement for making a claim.”
and inserting:
“6. In soliciting business through advertising, marketing and other means a
business must –
b) Not offer any cash payments or similar benefits as an inducement for making a claim.”
MoJ have launched a consultation exercise on this proposal and are seeking contributions by 10 February.
For the full text of Lord Young’s report “Common Sense – Common Safety” see:
http://www.number10.gov.uk/wp-content/uploads/402906_CommonSense_acc.pdf
The MoJ consultation paper is at:
http://www.justice.gov.uk/consultations/docs/consultation-claims-man-reg-cp1910.pdf
