Who is to blame for the compensation culture?

31 Jan 2014

There is a general impression that the compensation culture is out of control with dishonest and greedy clients making exaggerated claims, insurance companies selling peoples’ details and lawyers getting fat on the proceeds.

This is not surprising: we live under a constant barrage of television adverts, with emails and texts that we never asked for filling our inboxes, all urging us to make claims with the promise of rich rewards.

The reality is, most of this barrage is not from the legal profession. It is run by companies that are set up with the sole purpose of gathering the personal details of people who have been injured so that they can sell them to organisations that run legal claims.

These claims are then dealt with by huge, impersonal, factory like organisations that deal with each claim remotely, by telephone and email, never having any direct contact with the injured person.

James Bedford, Senior Personal Injury Lawyer at Gard & Co., commented that, “A claim for compensation should be more than a simple claim for money. It is part of the healing process and personal contact with clients is a vital part of that. Very often the injured person needs to have an opportunity to talk about their circumstances in order to help them come to terms with what has happened to them. This kind of interaction cannot take place on the telephone or by email.

“A more holistic approach is needed to establish trust and rapport so that the full story is exposed and the right solutions for the client are found. If the sole concentration is on reaching a final settlement as soon as possible, so that the next client can be brought in, important details are missed that will affect the overall outcome for the injured person. A better approach is to seek an early part payment to assist the client with rehabilitation and to help re-establish their life, without compromising their overall compensation.”

Another element of the culture is ‘third party capture’. This is where the insurance company of the person who caused the injury contacts the injured party direct, often very soon after the incident, to make an immediate offer of compensation. “These offers can seem attractive but are invariably well below the proper level of compensation. However, they are often accepted because the injured person has not had time to seek legal advice. Once the offer is accepted the injured party cannot bring a claim, even if they later discover they should have received more, to properly compensate them for their loss and suffering,” commented James Bedford.

Recent rule changes have banned the buying and selling of personal details in Personal Injury cases, which should go some way to reducing the number of unwanted emails, texts and calls trying to farm those detail. On this issue James Bedford said, “Hopefully this will help remove the feeling of a compensation culture. After all, in the UK, accident compensation is not punitive: it is not meant to be a punishment for the person who caused the accident. It is simply about helping accident victims put their lives back together, as close to they were prior to the accident as possible.”