Referral fees by another name

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21st October 2011

In this section I recently looked at Government proposals for reforms in the personal injury world. It seems finally they have lost the plot; assuming that they ever had a coherent plan in the first place.

The Law Society Gazette reports the Justice Minister, Jonathan Djangoly, as saying that he is content to see Claims Management Companies (CMCs) forge closer ties with solicitors once the referral fee ban in personal injury cases has been introduced. So, he plans to ban referral fees but allow them by another name.

One might be forgiven for asking the point of this legislation. Well now we know; it's cosmetic and political. All show and no substance.

In addition, the Justice Minister, in an astonishing demonstration of his naivety, states that he hopes the reforms will allow insurers to defend claims more readily and that from a Government perspective he encourages them to do so.

What world is this man living in? Insurers afraid to defend claims – I don't think so.

In a stroke he has recommended more litigation, which is precisely how we got in this mess in the first place and the reverse of what these reforms are meant to be achieve. No, I'm afraid the truth is out. These reforms are all about making the insurers more profitable and to hell with the rights of injured claimants.