CFA and insurance is it a scam?

darrenforster99

Hi,

About a year ago we were involved in a slight traffic accident where some idiot drove straight out of a car park into the side of our car (we have a strong feeling he was over the limit at the time, although unfortunately the police only give us a crime reference number at the time and so no-one breathalysed him to check - but the two other people in the car with me both agreed he did seem drunk at the time - but that did seem weird though as it was a hospital car park he was pulling out of, unless he was under some kind of medication).

We all had a bit of a jolt at the time and had a bit of pain afterwards.

We didn't think anything of the pain at first because it started to ease over time, but then we got a call from one of these Claims firms who asked us more about the pain and said we could claim about £1,000 from this accident, and as we had other people in the car at the time the case was really good so they could do it on a no win no fee basis.

Sounded good, I know they take so much off your claim to cover their costs and everything, but even if we got £100 it would be something.

Anyway they sent us all the legal terms and conditions document to sign from some company called Petherbridge Bassra solicitors and clearly they were hoping we'd just sign it and send it back without reading - oh yeah, I've nearly fell for that one before!!

As I was reading it stated about something called a Conditional Fee Agreement and that even if we win the case we would have to pay them a success fee which we couldn't claim back from the person who caused the accident, and might even end up costing us more money than we get back.

I don't mind paying someone, but the fact that there is a risk it could cost me more than I'm going to get, seems pointless even signing the contract. Plus I'm already in quite a lot of debt, so adding to it going after someone for a bit of neck pain barely seems financially sensible.

I also can't seem to see anywhere in the document where it states how much exactly we would be looking at for the success fee, which leads me to believe that if I'm successful they most probably will just whip a number out of their head which is far more than what I've gained.

I've already been screwed over by this accident because my old insurance company give my new insurer information that the case was still open when it was closed. After they'd rectified it the new insurer added £150 onto our insurance premium for the mess up (still annoyed at RSA Motability - our old insurer - for that mess)

So have you ever heard about CFA? is it a scam? are we likely to end up paying more to this firm than it's worth to make a claim?

InsideInsurance

Conditional fee agreement is the proper name of no win no fee.

The success fee is only paid if they win the case for you and should be a percentage of your damages, legally they can charge UP TO 25% of the damages - and most are in the 20-25%

The fee used to be paid by the third party but since April last year its now paid for by you. They have increased settlements slightly to partially compensate for this change

OnanTheBarbarian

CFA is the usual method of funding an injury compensation claim in the event you do not have a legal expenses policy to cover your solicitor costs.

The success fee that solicitors can apply for a PI claim is capped at 25% so you should not lose any more than that amount from the injury compensation payment.

If you have not yet signed the CFA then haggle with them and tell them you have some other solicitors who will do it for 10% or event for no success fee.

To assist you in knocking it down, and I have nothing whatsoever to with this firm, but I am aware a firm called Winn Solicitors, who are based in Newcastle, but who serve clients nationwide state on their website that 100% of damages are kept.

darrenforster99

Thanks for that - so that means if I win say for example £1,000 the most they could charge me would be £250 then (25% of £1,000).

OnanTheBarbarian

Yes, although it could be 25% + VAT, which would mean £300 is deducted from a £1000 settlement.

Quentin

OnanTheBarbarian wrote: »

Yes, although it could be 25% + VAT, which would mean £300 is deducted from a £1000 settlement.

No it couldn't.

The cap on deductions is 25% including VAT.

OnanTheBarbarian

yes you are correct, my bad

darrenforster99

ok thanks for that - either way incl VAT or not incl VAT I would still end up not owing them money - even without VAT included it's still only 30% max, although I can't believe the EU have decided that claiming compensation for an accident is considered a "luxury" and have added VAT to it!

Quentin

They won't take more than 25% (including VAT)

Onan made a mistake, and said so in #7

(The VAT is not charged on your compensation, but on the solicitors fees - the total including VAT is capped at 25% of your compensation))