Richard Edwards on the whiplash debate

Ken Clarke is making the important problem of fraudulent whiplash claims unnecessarily complicated.  The answer to the problem is not only staring the government in the face it is positively jumping up and down and screaming at it.  The ban on referral fees will have a substantial impact, provided the unlawful activities highlighted recently are not allowed to continue under the guise of alternative business structures. The government should also ban cash and other inducements.  It need not, however, take my word for that, this problem was identified by Lord Young in his report of 2010, endorsed by the Prime Minister.

The director of Argent Rehabilitation (part of the Parabis Group) has provided his solution to the problem, namely that accident victims should receive physiotherapy and no compensation rather than the cost of the physiotherapy and compensation. Well he would say that, wouldn’t he?   

I read recently that Direct Line is valued at between £3-£5 billion and Aviva £8.7 billion. The sheer financial clout of these companies makes them one of the most powerful and effective lobbying groups in the land and perhaps the effect can be seen in the different approach the government takes to the opposing sides in the debate.  For instance insurers were recently invited to a cosy meeting with the Prime Minister at number 10, although I haven’t heard it suggested that Peter Cruddas helped with the arrangements. Meanwhile not even the junior minister Jonathon Djanogly could be bothered to keep his engagement at the APIL conference recently, and chose instead to send a civil servant along in his place.  Listening to only one side of the debate leads to bad policy.

At its core this is not just a battle for influence with the government but for the hearts and minds of the premium paying public. The sheer scale of the problem of insurance fraud and the manner by which it is fuelled means that claimant lawyers who don’t pay referral fees or offer unsustainable incentives will find it difficult to get their message across.  For this reason I say the SRA is asleep at the wheel.

Although the problem of fraud in personal injury work is a serious issue the solutions are simple and the government should introduce them with haste.

An edited version of this letter was printed in the Law Society Gazette follow the link here:

 http://www.lawgazette.co.uk/opinion/letters/tackling-fraud