The Lloyd’s Market Association has backed government proposas to end recovery of conditional fee arrangements success fees and after-the-event premiums in its bid to reduce civil litigation costs.
The LMA has also called for the Ministry of Justice to “implement more thoroughly” Lord Jackson’s recommendations, including action on extending the use of fixed fees and banning – or capping – referral fees.
The LMA stated that the cost of settling personal injury claims is now “the single biggest category of expenditure” for motor insurers in the UK which is, in turn, causing rapidly escalating insurance premiums for Britain’s motorists. “The inefficient claims system is being exploited by middlemen and is leading to a personal injury claims system that is imbalanced, expensive and unfair to defendants.”
Commenting on the LMA’s consultation response, David Powell, underwriting manager, said; “The high cost of personal injury claims is having a direct impact on the insurance premiums being paid by Britain’s motorists and, without reform of the personal injury claims system, these will continue to rise. “We fully back the MoJ’s proposals to make CFA success fees and ATE premiums non-recoverable, but are concerned that the full package of reforms, such as extending the use of fixed costs and the ban, or cap, of referral fees, as recommended by Lord Justice Jackson, may not be fully implemented.
“Further, we do not support any alterations or alternative arrangements suggested in the consultation which would upset the careful balance struck by Lord Jackson between claimant and defendant interests.”
The LMA has also warned that the government will face significant pressure from claimant solicitors and other intermediaries with a vested interest in maintaining the current claims system.
“We urge the government to disregard narrow vested interests, to consider the wider public interest, and to press on with the rapid implementation of Lord Jackson’s recommendations in full,” added Mr Powell.
Medico-Legal News Source: Postonline
