April portal data contains pointers towards stabilising volumes and increased quantum levels
Release of April's portal data allows the opportunity to reassess key matrices as to claims volumes and levels of damages while the Civil Liability Bill continues its progress through the House of Lords.
Monthly new case figures
New RTA claims showed reduced levels in April, and in fact with the exception of December's figure, were at their lowest level for 12 months. This result has led average monthly intakes for the first 4 months of 2018 to fall below the average for 2017.
EL saw a slight increase in volumes in April, and in PL too there was a net increase once the shorter working month was taken into account.
Longer term new claims trends
RTA claims showed the rare phenomenon of a monthly increase when looked at over the longer term. If this sounds counter intuitive because of the monthly reduction in April, then it is due to last month's figure being higher than the corresponding level exactly 12 months ago.
If we extrapolate from a single month of data where the annual RTA portal data for 2018/19 might end up, the early indication is that it could be 4.9% lower than last year's total of 700,008, though higher than last year's CRU out-turn.
Both PL and EL also showed longer term increases, an indication that a trend of stabilising claims numbers may be becoming more established in those portals as part of the drift towards those types of claims which are less likely to be significantly impacted by incoming government reforms.
RTA claims showed record quantum levels for the second consecutive month, with the current level being 1.1% above that which pre-dated the 14th edition of the Judicial College Guidelines. An increasing trend is likely to continue when the JCG advised increases of as much as 4.8%, depending on progress with the Civil Liability Bill.
PL also showed quantum at a record level, now being 1.2% above the position which applied before the 14th edition arrived.
New RTA claims in April
The new MI shows that there were 55,457 new RTA claims in April, which represents a reduction of 5.6% over the month. It is the lowest number of new claims this calendar year. In fact, with the exception of the reduced number last December as is usually seen that month, it's the lowest monthly level since April 2017.
We usually can report that it's the lowest level of new claims for a particular month of the year since either the portal was new or at least was building up numbers in its first year of operation. It's not possible to do that time, because in addition to volumes in the first April of operation back in 2011 being lower, so was April 2017. The current level is in fact 6.9% higher than in April 2017 when it was 51,901.
While as noted April 2018 was higher than in April 2017 by 6.9%, it was lower than in April 2016 by 22.5% and lower than in April 2015 by 23.3%.
The month on month change at this time as between March and April's level is usually affected by whether the Easter holiday falls in March or April: this year it straddled the 2 months with one Bank Holiday in March and the other in April.
The common pattern recently has been that if Easter is in April then we expect March to be the higher month for claims intake followed by a percentage decrease into April measured in double digits, while if Easter is in March then that is usually sufficient for a small increase over the 2 months with April being the month with the higher claims intake.
Set against the month on month fall between March and April of 5.6% this year, in 2017 we saw a much larger fall of 23.3% when Easter fell in April, while in 2016 there was a rise of 1.1% when Easter was in March, and then in 2015 when Easter was in April there was a drop of 10.7%. So the relative neutrality of Easter's place in the calendar in 2018 means that a single digit monthly decrease fits with the pattern over recent years.
When we have compared the average monthly intake of new RTA claims during the calendar year of 2018 to date with that for the year 2017, up until this month we were seeing that 2018 had started with an average that was higher than for the full year of 2017. That is no longer the case. The average per month for 2018 now stands at 59,026, which is 0.8% lower than the 2017 average of 59,521. This shows that the early months of the year tend to see higher levels of claim than some later months of the year.
Comparing also to the first 4 months of 2017 the same position is reached. The current 2018 monthly average to date of 59,026 is 4.1% lower than the corresponding figure of 61,525 after the first 4 months of 2017. This would support a continuing pattern of declining volumes.
New RTA claims in April – time weighted
We can see that taking account of the number of working days in the month that we have a continuation of the 2018 pattern of monthly decreases, in the fact the third monthly fall in a row. There was 1 fewer working day in April when compared to March (21 in March; 20 in April) which amounts to a working time reduction of 4.8%. This is similar to the actual decreased volumes of 5.6% so justifies most of the fall.
We had 2,773 new RTA claims per working day in April compared to 2,798 in March. This is the 14th consecutive month with a level under 3,000 per working day. While the first 3 months of 2018 had shown levels on this form of measurement higher than any month in the second half of 2017, that is no longer the case and this month's daily level is comparable to certain other months over that previous period late last year.
New RTA claims over the longer term
Looking at longer term trends through the data available on a 12 month cumulative basis shows the rare phenomenon this month of a monthly increase, of 0.5% from 699,429 to 702,985. This is only the third increase over the last 32 months. We return back to a level in excess of 700,000 per year.
This rise of 0.5% follows monthly falls of 0.03%, 0.5% and 1.2% over the previous months of 2018. The average for the calendar year to date is now a fall of 0.3%, while the average monthly fall in 2017 was 1.1%.
Looking back in time, the rate of decrease over each of the two prior periods of 12 months is stable: between both April 2016 and April 2017, and between April 2017 and last month, it has both times been close to 9.4%.
Comparison with annual CRU and portal data
We saw from data released last month how the position ended up as at 31 March, the accounting year used by the DWP for the CRU data.
The CRU data ended up like this and showed a fall from 2016/17 to 2017/18 of 130,305 or 16.7% in reaching a new annual total of 650,019 or an average of 54,168 per month:
And the portal data like this and the decrease there over the last 2 years was 95,795 or 12.0% arriving at a new annual figure of 700,008 or an average of 58,334 per month:
It is clearly early days to start looking at where the total for 2018/19 might end up in terms of portal data after only 1 month's figures. But a first month's total of 55,457, while higher than the average monthly total for RTA claims last year on the CRU data, is lower than the more direct comparison of the portal data, by 4.9%.
If the first month's portal figure indeed proves in any way representative of future months, then an annual portal total for 2018/19 would be indicated of 665,484, lower than the previous year by the same 4.9%.
New casualty claims in April
The picture varied this month across the casualty portals when compared to last month. We saw a small increase in the number of EL claims and a reduction in the case of new PL claims albeit less than the amount of reduced working time.
In the case of EL disease there was another low month for claims intakes and the trend seems inexorably downwards.
New PL claims
There were 4,734 new PL claims in April, that's the 3rd consecutive monthly fall, and is a monthly decrease of 2.4%. This though is less than the 4.8% reduction in working time.
After 4 months of 2018, the monthly average is now 4,932, that's a 0.1% increase over the average for the calendar year of 2017 which was 4,926. But comparing to the first 4 months of 2017, the current level is 1.1% lower at 4,932 for this year compared to 4,989 for last year. As with RTA claims, there tends to be a higher number of PL claims in the early months of any year.
This is the lowest April for new claims into the PL portal for any year apart from last year: the current level is 14.8% higher than in April 2017 but lower than in April 2016 by 13.8% and lower than in April 2015 by 20.1%.
New EL claims
3,974 new EL claims entered in April, an increase of 0.7% from March. It's the 2nd consecutive small monthly increase despite the shorter working month.
After the first 4 months of 2018, the monthly average for new EL claims stands at 4,027, which is 4.3% higher than the average monthly figure for 2017 of 3,860. The current level is also higher than for the first 4 months of 2017, but by a smaller margin, in fact we now stand 0.6% higher comparing the current figure of 4,027 with the last year's 4,002.
Looking back in time, only 2 previous months of April have shown lower figures, one being the year this portal opened, the other was last year. So April 2018 is higher than April 2017 by 18.0%, but lower than in April 2016 by 7.7% and lower than in April 2015 by 7.6%.
New EL disease claims
There were 548 new claims entering this portal in April, a 20.6% reduction from March. Apart from December 2017, this is the lowest monthly intake of this type of claim since the portal was 2 months old and was building up a claims intake.
After the first 4 months of this year, the monthly average level is 659. That's a 13.9% reduction over the monthly average for the whole of 2017 of 756, and a 21.1% fall from the average for the first 4 months of the year which stood at 835.
The current number is significantly lower than each of the 3 previous years: a reduction from April 2017 of 21.7%, from April 2016 of 44.1%, and from April 2015 by as much as 75.7%.
New casualty claims over the longer term
When assessed over the 12 month cumulative basis in order to see longer term trends, we return to the picture in PL and EL where stable claims levels are being achieved over recent months, including last month where both claims types showed a month on month increase. The position is very different with EL disease where as noted above a declining position remains evident.
Over the 12 month period up until the end of last month, the total of PL claims made stood at 58,779, which is an increase of 1.0% over the level of 58,169 where the data stood at the end of the previous month. This is the 3rd increase over the last 4 months, but there have still been reductions in 29 of the last 34 months.
Over the 4 months of calendar year to date, because the one monthly fall was greater in extent than the sum of the 3 monthly increases, there is an average monthly fall of 0.1%. This though is much smaller than the average monthly drop for the calendar year of 2017 of 0.7%.
The historical annual rate of decrease has slowed, from 11.8% between April 2016 and April 2017, to 4.5% between April 2017b and last month.
In the case of EL, over the 12 months to the end of April, there have been 46,358 new claims, a figure increased by 1.3% from the corresponding figure at the end of March. That's the 3rd rise within the last 5 months, and it means that there have now been 21 monthly reductions over the last 29 months.
Over 2018 to date there have been 2 increases and 2 reductions, and an overall monthly average increase of 0.05%. This is a different picture from the average reduction for the calendar year of 2017 of 0.6%.
The historical rate of decline has slowed for EL too: from 7.3% over the period from April 2016 to April 2017, to 4.7% between April 2017 and last month.
With EL disease, there were 8,438 new claims over the 12 month period till the end of April, a 1.8% fall over the month from the figure at the end of March of 8,590. This is the 28th consecutive monthly fall.
The average monthly fall in the calendar year of 2018 is now 1.9%, greater than the 1.4% which was the average monthly rate of decline during 2017.
The rate of decline has though decreased over the longer term, from 46.3% between April 2016 and April 2017, to 16.0% between April 2017 and last month.
Last month saw a mixed picture: a small reduction in the proportion of retained cases for RTA and an increase for EL, but substantial falls in relation to PL and EL disease.
Longer term, measured over the preceding 12 months, trends are marginally positive for RTA, PL and for EL, though negative for EL disease.
Casualty claims – stage 3 usage and PSLA levels
There was reduced here of stage 3 across all casualty portals.
PL fell 32.1% to 55, the lowest level for a year.
EL fell 3.8% so less than the effect of the shorter working month to 77.
And there were 0 EL disease court packs, the 3rd time since the early days of the portal when this result has been seen.
In the case of PL this average level rose 4.9% to £4,345, the highest ever month, and demonstrating a 1.2% increase since the 14th edition of the JCG.
EL rose marginally by 0.6% to £4,176, but with no discernible increase since the 14th edition.
EL disease fell 13.3% to £3,611 again with no noticeable increase since the last JCG.
RTA claims – stage 3 usage and PSLA levels
The number of RTA court packs prepared as a preliminary process to use of stage 3 fell 1.6% over the month to 5,971, but this is less than the reduction of working time of 4.8%.
This average level rose 0.1% or by £4 to £2,812, for the second consecutive month setting a new high point. This is now the 4th time that the level has exceeded £2,800.
We are now 1.1% higher than in November 2017, when the effects of the 14th edition of the Judicial College Guidelines proposing average increases of 4.8% came into effect so we would expect continued upwards movement in PSLA levels as the difference between 1.1% and 4.8% suggests there is headroom in which to do so.
Comparative use of stages 2 and 3
In the case of RTA, the current trend is one of stabilisation at around the 30% level, so 3 in 10 RTA cases need to use stage 3 at least initially before settling.
Both PL and EL show no sign of increasing use of stage 3, and in fact have regressed over the month, currently at levels of around 10%.
For more information please contact Simon Denyer, Strategic Legal Development Consultant, DD +44 161 604 1551, Simon.Denyer@dwf.law
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.