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Latest Claims Portal statistics show unusual trends

21 May 2015

The release yesterday afternoon of April’s Claims Portal Limited’s data shows some new trends of which we had seen little or no evidence so far in 2015. Instead of revealing further increases in the number of new claims submitted to the RTA, EL, PL and EL disease portals as we had seen almost without exception over the first 3 months of the year, there were decreases in the numbers into each portal last month. Not only that, but those falls were in each case in double digits, ranging from 10-14.5%.

So we need to try to make sense of the figures when continuing to look for signs of future trends. And we need to look back too at issues relating to the release by the CRU of their annual new claims data on 29 April and to APIL’s claims about them, this being the first Portal Company data release since the CRU figures became available.

RTA new claims

The figure for new RTA claims in April was 73k, a fall of 10% from the 81k level seen the previous month. But the number is still above the annual average for the last 12 months which stands at 72k. And of course the month of April in the RTA portal was another untypical month affected by incoming reform, so it would be unwise to draw definite conclusions from it.

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We saw how in March that the new claims figure of 81k was the second highest month for new claims ever. That was partly caused by the incoming changes for “soft tissue injury claims” of phase 2 of the MoJ reforms on independence of medical evidence. This of course requires the use of the new MedCo processes for selecting medical experts where the CNF was lodged to the portal after 6 April, though there is an exemption allowing use of a medical expert not selected via MedCo where that expert was instructed before 6 April even though the CNF was not lodged till later.

Certain claimant solicitors clearly wanted to submit additional claims without having to follow the new processes and did so in March, so raising the new claims number for that month to 81k. The exemption available allowing use of an expert instructed before 6 April will though have tended to water down pressure on those claimant firms to have lodged their CNFs before 6 April.

April was therefore a month which straddled that incoming change. There was reason for those claimant lawyers who wanted to avoid the new provisions around MedCo (by taking the step of submitting new CNFs pre 6 April) to do so right at the start of the month if they had not done so in March. There was probably therefore a higher number of new RTA claims in that first week of April. But for the rest of the month we can then (as with other periods after an incoming reform) expect to have seen a drop-off in the number of new claims submitted. So April’s figure is essentially a compromise between these two factors – high in the first week of the month, lower for the rest of the month. It is hard therefore to see the ultimate new claims number for April as being of great significance either way on the question of trends on future RTA claims volumes.

And we expect the data for new RTA claims for May when released next month again to be affected by another incoming reform in relation to whiplash claims, that is the need in the case of new CNFs in those cases to include confirmation that an askCUEPI search concerning the claimant’s claims history has been carried out. Any claimant lawyers who think their claims profile includes claims likely to show positive searches from that database may prefer to avoid having to carry out that search, and so may ensure that new CNFs are lodged in May where possible.

If we are right about that, then we should expect a corresponding decrease in the following month’s data for June, so a more stable picture may not emerge until the data for July is released.

Casualty portals

The falls in the number of new claims in April was not limited to RTA claims but was seen across all 3 casualty portals too.

  • The number of EL claims fell 14.5% to 4,364.

  • The number of PL claims fell 11.5% to 6,823

  • The number of EL disease claims fell 14.5% to 2,311

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In the case of the EL and PL portals, these were the first falls after 4 consecutive months of increases, in the case of the EL disease portal it was the first decrease after 3 consecutive monthly increases.

This looks significant, but is it? What explanation could there be? The factor we have seen in RTA claims of changes to the Pre-Action Protocol clearly cannot apply here as casualty claims are unaffected by that change.

Perhaps after 3 or 4 monthly increases it is simply that the pendulum is swinging back towards an average? The only other factor which could be relevant again is a reduced number of working days worked by claimant lawyers in the month of April. There were 20 working days in April as compared to 22 in March, but in addition, the Easter period is frequently one when additional holidays are taken. The more mature RTA data always shows lower new claims numbers in April than in March, so the decreases in new claims numbers could simply be due to that Easter effect. We would not as yet see significance in the decreases shown this month as to new claims into the casualty portals.

Relationship to CRU data

And what of the link to the annual CRU new claims data for injury claims released 3 weeks ago? We saw then a fairly stable picture and that over the 12 months to the end of March that in 2014/15:

  • The total of new claims was down 2% to 998k

  • Motor claims were down 1.5% to 762k

  • EL and EL disease claims counted together were up 2% to 103k

  • PL claims were down 3.5% to 100k

The only comparison which can be made with the portal data is for RTA claims as there is insufficient data as yet in the casualty portals, and in any event the CRU data does not distinguish as between EL claims on the one hand and EL disease claims on the other.

APIL have supplemented the published CRU data with a Freedom of Information request to CRU which they claim shows the number of whiplash claims has fallen 23% from 488k in 2012/13 to 376k in 2014/15. They do not state the figure for 2013/14 that their FoI request also presumably produced.

The data from the RTA portal shows 789k claims in 11/12, 887k claims in 12/13, 787k claims in 13/14 and 858k claims in 14/15. The overwhelming majority of the claims to the RTA portal would have been whiplash claims. The increase in the portal limit from £10k to £25k as at April 2013 would only have had a marginal effect. The 12/13 figure will have been affected by the pre-LASPO peak (APIL do not refer to the steps taken by their members to bring forward substantial claims volumes to avoid the incoming LASPO changes) so the better conclusions in relation to RTA new claims data from the Claims Portal stats would be:

  • Over the last 12 month period, in 2014/15 the number of new RTA claims was up 8% from 2013/14

  • Over the last 4 year period, in 2014/15 the number of new RTA claims was also up 8% from 2011/12

Even when APIL publish the full response to their FoI request, the accuracy of the data obtained will be open to doubt. It cannot be right that where Claims Portal are measuring over 850k RTA claims the vast majority of which are for whiplash, that CRU data can suggest there are less than half that number in fact. Clearly, CRU processes as operated in RTA claims are significantly under-recording.

Retention rates

The 12 month cumulative graph continues to show the RTA figure nudging 50%, the EL and PL figures deteriorating towards 30% and 20% respectively, while there is a continued improvement in the retention figures for EL disease which continue to rise and now stand at 26%.

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Stage 3 and court packs

Claims Portal data continues to show significant use of stage 3, but this month the trend has not worsened. As to RTA claims, the number of cases reaching stage 3 has fallen this month by 1% to 4,147. Over the last 12 months though, 38,500 RTA claims reached stage 3, a 97% increase over 13/14 and a 192% increase over 12/13.

In the case of EL, PL and EL disease, the same trend has yet to appear as the use of stage 3 is relatively stable, and in any event there are too few claims reaching that stage to be able to draw any further conclusions.

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The difference between stage 3 data and the issuing of proceedings

When looking at the stage 3 data from the portal, some insurers may not have seen quite the same trends appearing in the number of their claims in which court proceedings are issued under Part 8 of the CPR. It is worth noting that the Claims Portal stage 3 data represents the number of court packs drafted, rather than the number of Part 8 proceedings actually issued. There is no data available on the number of issued sets of proceedings in that part of the process. We should therefore recognise that while the data clearly shows intent to move more cases towards Part 8 proceedings by preparing a court pack, we cannot actually measure the trends as to the number of proceedings themselves.

There are additional fees for claimant lawyers to chase in this territory generally. If the claim settles on the basis of an increased offer after the court pack is prepared but before Part 8 proceedings are issued then additional “late settlement costs” of £250 are payable and may need to be paid to achieve a deal. As well of course as there being the potential for additional costs of £500 to be payable if Part 8 proceedings are commenced and the case proceeds to an oral hearing at which the claimant recovers more than the insurer’s offer, in addition to recovery of the court fee of £280.

PSLA levels

The previous graph shows continued stability in the RTA figure, which at £2,593 is the same as the previous month. The increase over the last 12 months is 1.4%, whereas in 13/14 we saw an increase of 22%. We await the next Judicial College Guidelines later this year in order to expect to see some further upward trend.

The EL and PL portals show their highest figures yet on a continued upward trend as larger claims settle, at £3,456 and £3,581 respectively. The EL disease figure at £4,358 shows a fall of 12% after 2 successive monthly rises but continues to be affected by a low volume of claims in that portal.

Contact

For more information please contact Simon Denyer, Partner on +44 (0)161 604 1551 or email simon.denyer@dwf.co.uk

By Simon Denyer

This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.

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