Whilst the majority of personal injury solicitors are complaining about the government’s plans to ban claims management and insurance companies from selling victims details to lawyers, a couple have spoken out in favour of the proposals.
John Spencer for example, from the Chesterfield firm CS2 Lawyers, has spent years campaigning for a ban on referral payments for personal injury claims. He says that referral fee payments create questionable commercial incentives and these are responsible for increased insurance premiums.
Spencer argues that referral fees are dysfunctional and provide no value whatsoever to legitimate claimants. All they do is line the pockets of many people participating in the market. The government’s proposed ban is a powerful first step towards setting things right.
Mr Attwood from Attwood Solicitors made virtually the same comment as Spencer, adding that the practice of referral fees leads to companies encouraging people to put in spurious claims for personal injury compensation. Banning them should lead to less claims being made which will ultimately mean lower insurance premiums for everybody.
Attwood went on to say that people who class all personal injury lawyers as the same might be surprised by his stance and he explained that has no objection to the concept of ‘no win, no fee’ in personal injury cases.
The Ministry of Justice announced last month that it plans to ban the practice of referral fee payments in a bid to clean up the personal injury market, put a stop to the compensation culture and tackle the rising cost of insurance.