Motor Legal Protection

AlanP52

How important is Motor Legal Protection on car insurance - an additional £30-£35 sometimes - is it worth it ? and what does it provide ?

InsideInsurance

It provides representation to assist in the recovery of your uninsured losses (eg excess, loss of use, loss of earnings, injury etc)

Generally it is useful for low value accidents excluding injury where a no win no fee solicitor cannot be used.

Crazy_Jamie

InsideInsurance wrote: »

Generally it is useful for low value accidents excluding injury where a no win no fee solicitor cannot be used.

Though after 1st April 2013 funding in personal injury claims is changing significantly. Whilst previously legal expenses policies have were often seen as an unnecessary expense due to simply being able to instruct a solicitor on a 'no win no fee' basis, given the changes coming into force my own view is that legal expenses policies become considerably more attractive.

BertTheRaccoon

But do you see the LEI providers actually providing a proper indemnity for legal costs Jamie?

I mean will they allow a lawyer to do a "proper job" at an hourly rate or will it mean the panel firm of the LEI provider will be instructed as a condition and it will be the "pile 'em high,. sell 'em cheap" attitude?

Given the advent of one-way costs shifting, where are the Claimant's risks ultimately?

I have read that some people have it on good authority that the PI small claims limit will rise to £5k shortly.

Contingency fees all round as I have the highest suspicion that the actual LEI underwriters are not going to want to pay lawyers fees when there is no right of recovery as this will affect the actual premiums for these champertous policies and then nobody will buy them.

What's your take?

InsideInsurance

Crazy_Jamie wrote: »

Though after 1st April 2013 funding in personal injury claims is changing significantly.

Have to admit for the last two years I've been working in Europe and the US so not been as close to the changes in the UK legislation as I probably should be.

Conditional funding was always something that wouldnt last forever

BertTheRaccoon

http://www.guardian.co.uk/law/2013/mar/21/personal-injury-law-firms-claimants?INTCMP=SRCH

thenudeone

If you have ever worked for the civil service or any company doing government work (eg Capita) or similar (eg: Royal Mail) you get legal cover for you + spouse for £18 pa with csma membership https://www.csmaclub.co.uk. much cheaper than £40 or so each!

Crazy_Jamie

All valid questions, and for the most part we're not going to know the answers until companies actually react to these changes.

What I hope happens is that LEI companies recognise that in the area of personal injury their limited ability to recover costs in a lot of cases is offset by the fact that there is now minimal risk of paying the costs of the other side in the event of a loss. This is not a new concept for LEI providers; you cannot recover costs in the employment tribunal by default either, yet LEI is a common way of funding those claims. Whether LEI providers offset any perceived risk by an increase is premiums for LEI is up to them, but the changes should not result in an inferior product to the consumer. Solicitors and barristers involved in LEI cases should be funded to the extent that is reasonably required to properly represent the client. I can't see that principle changing because it undermines LEI as a product if it does.

BertTheRaccoon wrote:

I have read that some people have it on good authority that the PI small claims limit will rise to £5k shortly.

I am quickly learning with the Jackson reforms that 'good authority' is very hard to come by. The small claims limit will increase to £10,000 in line with the reforms, but currently the £1,000 personal injury threshold remains the same. There is consultation ongoing to increase that to £5,000, though there is a suggestion that the increase would only apply to whiplash claims.

Ultimately, the changes are already likely to hinder access to justice for those involved in personal injury claims, but they are changes that people will adapt to. However, raising the personal injury fast track limit to £5,000 is likely to be cataclysmic in my opinion in terms of access to justice. An injury with a valuation of £5,000 is one that can potentially last years and involves significant detriment for the person who suffers it. Not only will it be a struggle to fund claims if the limit is increased, but that in turn will result in a significant reduction in options in terms of solicitors. The industry will be decimated if that happens, and contrary to the view advanced in the press, that is most certainly not a good thing.

BertTheRaccoon

Crazy_Jamie wrote: »

Solicitors and barristers involved in LEI cases should be funded to the extent that is reasonably required to properly represent the client. I can't see that principle changing because it undermines LEI as a product if it does.

That's the principle, but I have never known an LEI pay solicitor's costs when acting for a claimant in over 15 years working as a claimant lawyer. I have also seen with my own eyes evidence where "panel" solicitors are told they can't actually claim against the policy, so a true indemnity is never there. Frankly I don't expect there to be much if any change with this.

I expect the LEI to dictate terms to any panel firms, essentially saying, "if you want the work, you'll do it for the fixed costs available" Or the LEI, like DAS have done, will buy a law firm.

Crazy_Jamie wrote: »

However, raising the personal injury fast track limit to £5,000 is likely to be cataclysmic in my opinion in terms of access to justice. An injury with a valuation of £5,000 is one that can potentially last years and involves significant detriment for the person who suffers it. Not only will it be a struggle to fund claims if the limit is increased, but that in turn will result in a significant reduction in options in terms of solicitors. The industry will be decimated if that happens, and contrary to the view advanced in the press, that is most certainly not a good thing.

But look what has happened so far...

1- The insurers have tea with PM Davey Cameroon at Downing Street, deals are struck as to how the whole personal injury sector will be overhauled for the insurers advantage, all along with the promises by the insurers that they will lower people's premiums.

2- The complete blackout by the press as to the obvious detriment a genuine claimant will suffer with the proposed reforms.

3- The ABI continuing to peddle utter tosh about "fat cat lawyers" and how all of these premium increases are due to claimant lawyers. My favourite is the statistic about how the number of accidents has decreased, yet the number of injured claimants has increased. Want to know why? Well it's because the insurers all got involved with capture of injury claims, if they could not get someone to claim they were selling the details on. This had a massive impact on the number of claims arising. Yet they then turn around and say it's all because of Claimant lawyers and accident management companies or fraud. The press can't get enough of this crap and just repeat it ad infinitum.

4- Costs of claims have been capped for the last couple of years with the use of the portal. Results of this have been seen already with some insurers announcing record profits and operating ratios improving massively.

5- Announcements by Dominic Clayden of Aviva that PI lawyers should be cut out of the equation completely and Claimants should be forced to go directly to the third party insurer. Hell insurers can't even look after their own policyholders well let alone a third party bereft of any legal advice.

6- No consultation with any of the claimant side of the fence before these reforms were approved and a judicial review saying "if you're not happy boys, make your concerns known at the ballot box" I mean !!!!!!!

So far, the insurers have been told that they are pushing against an open door. I believe that the £5k PI threshold will get approval and I can only echo your sentiments about access to justice by people injured with some quite nasty and long lasting injuries.

Meanwhile, are your insurance premiums going to drop? I genuinely challenge anyone on that point as the insurers are as beyond help as the bankers.

Man in the street doesn't give two hoots about this as he doesn't need an injury lawyer right now and he has legal cover with his car insurance, but let's see how well he gets looked after with a fractured leg put in scaffolding and off work for 6 months with a lawyer needing to run a case after 1st April for £800.

Would the nations plumbers be happy if the government said you can't charge more than £5 per hour?

C_Mababejive

A friend had legal protection insurance on her motor car with Liverpool victoria and they were useless and a complete waste of time. She ended up litigating successfully herself.

Crazy_Jamie

I do find it very difficult to disagree with you in principle, Bert. The reality is that the general public perception of personal injury litigation and those involved in it is wholly inaccurate due to the manner in which the press report on this area, and the ease with which it is linked to something that every person wants to pay less for (car insurance). The result is that lawyers are a very easy target for government policy, and the man in the street nods along with the changes because he is unaware of what access to justice is and how it benefits him. Until, of course, he needs it, and cannot get it. This applies not to just to civil law, but crime and family too. By the time a lot of this comes to a head and change is once again touted (which I expect will happen), an awful lot of damage will have been done to the lives of innocent people.