By John Durbin, Senior Business Development Manager
(Estimated reading time: 3 minutes 20 seconds)
As 2022 drew to a close, we invited all of our personal injury and clinical negligence coverholders to give us feedback on how we had performed during the year, as well as their thoughts on the important developments the market could expect in 2023.
One of the questions that we asked was ‘With the recent news that fixed costs are going to be put back to October 2023 at the earliest, please provide us with a quick summary on your thoughts of these proposed changes.’
As predicted, the question divided opinion, as well as highlighted the uncertainty any potential fixed costs regime will cause. Below are redacted statements from some of our coverholders who kindly shared their thoughts:
- “We think that there is a risk that this regime will make it more difficult to investigate claims adequately as complexity and value are not necessarily linked and are therefore concerned that this will impact on access to justice, however, until we see how things work in practice it is difficult to know for sure what issues will arise.”
- “It will be interesting to see the detail of the regime and whether certain claims, such as fatal claims, will have special provision. The introduction of fixed fees will impact the way we work in that more work will need to be delegated to junior staff and we are less likely to take on lower value claims.”
- “Difficult to see how clinical negligence cases can be run profitably on fixed costs and how Temple’s ATEI will work with cases which start as MT and fall into fixed costs?”
- “Fixed costs will in no way benefit the Claimant or the running of the claim and will result in more satellite litigation when costs are exceeded given the Defensive nature of insurers”
- “They could work if the level of fees were fair and reviewable…”
- “Slightly positive. Extended fixed fees might work better in some cases depending on level of fixed fees as they avoid risk cost and delay of costs budgeting & detailed assessment but economics only likely to work by taking an even greater % of client’s damages which we would not be happy about. Hopefully delaying introduction will mean they more carefully consider terms for fixed fees and ensure they are at a sensible and inflation-proofed level, which is index-linked. We shall see!”
- “In theory, FRC are almost a no-brainer, in that they would provide certainty and clarity for both sides of the litigation, as well as killing off all the unnecessary, frustrating and utterly wasteful (of time and costs) satellite litigation that surrounds costs generally, but, as always, with the present Government’s all-too-cosy relationship with the big Tory-donating insurers and their hatred of lawyers generally and continuing campaign to try to remove lawyers from any legal process they can think of, the level of fixed costs set, each time they extend the regime, is just so ridiculously, defendant-biased low as to render whole areas of work almost uneconomically viable – compare with the eye-watering levels/rates of company/commercial costs, which (surprise, surprise!) never seem to get touched – which leads to less provision of the full range of services for the public and more ‘snouts pushing in the same smaller and smaller troughs’, such as high-value clin neg, for example, where FRC are not in place (yet). Another very negative knock-on of this ‘snouts in troughs’ point, which affects insurers like Temple too, is that these are very highly skilled, specialist areas of law, requiring expert firms like ours, but punters can often end up with less skilled/specialist firms doing difficult, specialist work, with obvious negative results (including more claims on ATE policies).”
Temple continues to keep a watching brief on the development of fixed costs. Internal discussions are already underway to ensure that, once we know the ‘devil in the detail’, we are in a position to create market-leading ATE products which continue to provide access to justice.
If you’d like to discuss the FRC regime in more detail or share your views, please email firstname.lastname@example.org or call 01483 577877.
John joined Temple in 2022 and brings with him over 19 years’ experience in the legal expenses industry, with 17 of these specifically relating to ATE insurance.
As Senior Business Development Manager, John’s role has him covering the breadth of the UK, meeting with Temple’s existing business partners as well as establishing new business relationships. Whilst his primary focus is growing and developing our clinical negligence and personal injury offerings, which can include disbursement funding, he is also very able to discuss Temple’s commercial and BTE products.
John is well known in the industry for making business partners feel at ease when they meet. He prides himself on understanding customers’ needs and being able to work collaboratively, which frequently results in established working relationships for many years.
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