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Untypical portal activity in August results in short term increased new claims volumes

4 October 2016

Later than usual, Claims Portal has released its MI for the month of August. While we continue to await any definitive news of the new government’s approach to the Autumn Statement reforms, we look to interpret the latest numbers and trends.

In summary

In the past, because of fewer days worked due to holidays, August has always shown reducing levels of portal activity with reductions in volumes of new claims entering. This year, the August data surprisingly shows a consistent picture of increasing numbers of new claims across the RTA and all three casualty portals.

Longer term trends based on an analysis of data over a prior 12 month period shows in the case of the casualty portals a continuing decreasing trend on new claim volumes, but the same previously seen reducing trend for new RTA claims has been marginally reversed as the data for August has led us into a very small increase. Nevertheless, new claims remain 8.8% above the post LASPO level.

New RTA claims in August

There were 68,932 new portal claims submitted in August, a rise of 4.7% over July. This follows on from a 4.8% drop which we saw when analysing the same data a month ago.

Despite this monthly increase, the level of new RTA claims remains 3.6% below the 2015/16 average of 71,491, and also 1.8% below the average over the first 6 months of 2016 of 70,186.

Yet the increase as between July and August bucks the trend of what is usually seen this time of year. Over the last three years if we compare the holiday month of August with the preceding month of July we have seen the number of RTA claims decreasing by 20.8%, 11.0% and 15.8% across those three years. You can compare those figures with this year’s increase of 4.7%.

Portal October 1

New RTA claims 12 months cumulative

Taking into account both the month on month increase of 4.7% which we have observed, together with the fact that the new RTA claims level for August 2016 was higher than that for August 2015 which now falls off the end of our 12 month analysis, it follows that we can see a small increase of 0.13% on this measurement, as the 12 month cumulative figure has increased this month from 838,341 to 839,421.

Looking at the graph below, the two bars on the extreme right seem to be of equal height. In fact, that for August is marginally higher than the one for July.

Portal October 2

And so we can see that we have an increase this month on this form of measurement. This brings to an end the previous pattern of month on month falls which we had seen for the last 8 consecutive months, and indeed for 11 of the last 12 months.

Claims Portal will always revise their data the following month after its release. This is presumably to improve accuracy and consists of limited tweaks to that data. The small increase of 0.13% may be within the margin which could be affected by any such revision next month. We saw this happening with the data for June this year when what was originally shown as a small increase became a limited decrease once the data had been revised by Claims Portal.

While we should therefore be wary in drawing conclusions from marginal changes in the data, we can be more confident in doing so where the data is clear cut.

In that more certain vein, the current cumulative number of 839,421 over the last 12 months is now 4.7% below the recent August 2015 peak of 880,467. Broadly, this is the same position as last month.

After the LASPO reforms had bedded in, we saw this 12 month cumulative measurement fall to 771,711 in April 2014. At a current level of 839,421, we continue to be seeing new RTA claims at a rate of 8.8% more than the post-LASPO level.

New casualty claims in August

When looking at the Claims Portal data a month ago, we saw the same consistent picture in the casualty portals as we had in the RTA portal, of falling volumes. It is the same consistent picture again this month when we look at the data for August, but it’s just that the position is reversed with month on month increases this time round rather than the decreasing trends seen last month.

Portal October 3

In PL, the number of new claims increased by 4.8% to 5,525. However, this level remains below the 2015/16 average of 5,857 by 5.7%, but the current level is almost identical to the average for the first 6 months of 2016 of 5,524.

In the two previous years over which data is available, we had seen decreases of 15.0% and 12.5% when comparing the July and the August data, no doubt due to factors associated with holiday absences on the part of claimant lawyers. It is these figures which should be compared with the rise of 4.8% this year.

With EL, the position is broadly the same. The number of new EL portal claims in August at 4,396 rose 8.2% over the July position. The August level was marginally above (by 0.005%) the average for 2015/16 of 4,375, and was also 3.5% higher than the average over the first 6 months of 2016 (4,247).

Looking at the usual position between July and August, we had previously seen falls of 13.1% and 14.9%, but this year we do as stated have a rise of 8.2%.

As to EL disease, in August there were 896 new claims submitted, an increase of 8.7% over July. But this low level of claim remains far below previously seen levels. It is 46.2% below the 2015/16 average of 1,665, as well as being 18.1% below the average for the first 6 months of 2016 (1,094).

Once again, when comparing July and August over the last 2 years, we had seen drops of 24.5% and of 8.5%. No fall this year. Instead we have that rise of 8.7%.

New casualty claims 12 months cumulative

The casualty trends on this basis continue to point downwards.

As to PL, we now have seen 14 consecutive monthly falls. The current number of 66,764 is 13.7% below the peak of 77,384 seen in April 2015.

In the case of EL, though this month’s level of 50,937 is actually marginally higher than last month (just 86 more), the trend is still downwards, now over 7 of the last 9 months.

Continuing on EL, the latest number of 50,937 is 7.2% below the peak of 54,879 seen in September 2015.

In the case of EL disease, we have now seen 8 consecutive monthly falls. The current level of 15,041 is 34.9% below the December 2015 peak of 23,113.

Portal October 4

Retention rates

This month there are downward trends on RTA and EL disease, but upward movements on PL and EL. None of the lines on this graph showing 12 month cumulative data are likely to converge at any time soon.

Portal October 5

RTA claims still in the portal and settled claims

The number of RTA claims still in the portal can be seen here:

Portal October 6

Claims Portal introduced their data cleaning exercise on 23 May but has issued no updates as to its progress since as yet. The exercise has not succeeded in reducing the trend towards an increasing number of portal-retained claims as yet.

The number of RTA claims settling at stage 2 has continued to fall and this will partly explain the position on the previous graph. In turn, the number of settled claims will be impacted by an increasing use of stage 3, as well as by changes in the number of claims entering the portal.

However, the cumulative graph below shows a continually falling number of settlements since the LASPO period, without the variations in the number of claims entering that portal, when the two graphs showing their data on a 12 month cumulative basis are compared.

Portal October 7

RTA stage 3s and PSLA levels

Increased use of stage 3 continues apace. In August 6,455 RTA settlement packs were produced as part of stage 3. This is the highest level ever reached so far.

The same month, 16,727 claims were settled at stage 2, without use of stage 3. In other words, of the RTA cases settled in August, 28% were taken to stage 3 before settlement could be reached. Taking into account recent trends, this is only likely to increase further towards one-third and perhaps beyond.

Portal October 8

The level of PSLA offers also increased in August to £2,678. This is the second highest ever, only beaten by the untypical month of October 2015.

The level of PSLA is now 3.8% over the average of £2,580 seen in the November 2015 to February 2016 period.  The effects of the increases seen in the 13th edition of the Judicial College Guidelines are being felt.

Casualty stage 3s and settlement levels

Portal October 9

In the case of both PL and EL, stage 3 use continues at relatively higher levels than was previously the case, but not as high as motor in proportionate terms.

In PL, there were 61 stage 3 packs, that is 8.5% of total stage 2 and stage 3 resolutions.

In EL there were 54 stage 3 packs, representing 7.8% of total stage 2 and stage 3 resolutions.

In EL disease on the usual low sample there were 3 stage 3 packs, 5.4% of the total of stage 2 and stage 3 resolutions.

In terms of PSLA, PL reached £4,050 and EL was £4,324, each the highest ever for those two portals.

When compared to the November 2015 to February 2016 averages, PL now stands at 5.7% above that level and EL at 12.8% above that level, both higher increases than RTA.

EL disease was as variable in August as always on particularly small samples, PSLA reaching £3,897, that is 1.4% over the November 2015 to February 2016 average.

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.