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  • FIRST POST
    Randy Watson
    Solicitor wants 25% of my personal injury compensation
    • #1
    • 3rd Jun 13, 11:31 AM
    Solicitor wants 25% of my personal injury compensation 3rd Jun 13 at 11:31 AM
    I was involved a car accident earlier this year and broke my leg. I was off work for eight weeks so was advised to make a personal injury claim.

    I contacted a solicitor last week hoping for a 'no win, no fee' arrangement but was told I would have to give them 25% of my compensation if the claim was successful.

    They said it was to do with the new laws and can't recover costs from the other persons insurance company.

    Has this happened to anyone else recently?

    Are there solicitors out there who will still take cases on a 'no win, no fee' basis? or is the 25% deduction commonplace now?
Page 1
    • huckster
    • By huckster 3rd Jun 13, 12:45 PM
    • 3,824 Posts
    • 1,730 Thanks
    huckster
    • #2
    • 3rd Jun 13, 12:45 PM
    • #2
    • 3rd Jun 13, 12:45 PM
    No experience of this, but I think there have been some changes in law.

    Why don't you make a few phone calls to see if other personal injury Solicitors are doing similar and post back here, to inform others.
    • little miss muppet face
    • By little miss muppet face 3rd Jun 13, 1:02 PM
    • 349 Posts
    • 240 Thanks
    little miss muppet face
    • #3
    • 3rd Jun 13, 1:02 PM
    • #3
    • 3rd Jun 13, 1:02 PM
    All firms will take a cut if you win, unsure of the %, your one is saying they will take a cut if successful, so must be no win no fee.
  • BertTheRaccoon
    • #4
    • 3rd Jun 13, 1:22 PM
    • #4
    • 3rd Jun 13, 1:22 PM
    There were new reforms which were brought in with effect from 1st April this year that no longer allow a solicitor to recover the "success fee" from the insurer of the other party.

    These fees are now recovered from the client. This is industry standard now. All you could do is see if the solicitor will haggle on the success fee.

    (Text removed by MSE Forum Team)

    A law firm who does not charge you a success fee under their no win- no fee agreement would basically be doing all the work involved in your claim for a fixed fee of £500 they will be paid by the insurer - if it not economic for a solicitor to run a case like yours for only £500 without the lawyer quickly going out of business.

    So yes, from now on 25% deduction from a compo claim is the norm.

    You have the Tory government and their insurer chums to thank for that.
    Last edited by MSE ForumTeam3; 04-06-2013 at 9:51 AM. Reason: Self Promotion
    • InsideInsurance
    • By InsideInsurance 3rd Jun 13, 1:45 PM
    • 22,215 Posts
    • 11,383 Thanks
    InsideInsurance
    • #5
    • 3rd Jun 13, 1:45 PM
    • #5
    • 3rd Jun 13, 1:45 PM
    Has this happened to anyone else recently?

    Are there solicitors out there who will still take cases on a 'no win, no fee' basis? or is the 25% deduction commonplace now?
    Originally posted by Randy Watson
    As above, the laws changed meaning solicitors have a much lower fee that they can earn from the third party insurers and so most are now wanting to take some of your damages to cover some of their lost earnings.

    Of cause if you have Legal Expenses/ Uninsured Loss Recovery on your motor insurance (or home insurance if you were a pedestrian/ cyclist at the time) then this would be covered by that policy
    • olly300
    • By olly300 3rd Jun 13, 1:59 PM
    • 14,312 Posts
    • 13,632 Thanks
    olly300
    • #6
    • 3rd Jun 13, 1:59 PM
    • #6
    • 3rd Jun 13, 1:59 PM

    So yes, from now on 25% deduction from a compo claim is the norm.

    You have the Tory government and their insurer chums to thank for that.
    Originally posted by BertTheRaccoon
    It's all the whiplash claims that have helped caused the problem.
    I'm not cynical I'm realistic

    (If a link I give opens pop ups I won't know I don't use windows)
  • Randy Watson
    • #7
    • 3rd Jun 13, 2:07 PM
    • #7
    • 3rd Jun 13, 2:07 PM

    Of cause if you have Legal Expenses/ Uninsured Loss Recovery on your motor insurance (or home insurance if you were a pedestrian/ cyclist at the time) then this would be covered by that policy
    Originally posted by InsideInsurance
    If I had legal expenses insurance on my motor insurance would that prevent the deductions from compensation? I thought that would just cover the legal costs of a solicitor actually taking my case on.

    I've tried phoning a few different solicitors and it seems the 25% deduction is across the board.

    Seems a bit rubbish to me.
    • tasticz
    • By tasticz 3rd Jun 13, 2:09 PM
    • 378 Posts
    • 115 Thanks
    tasticz
    • #8
    • 3rd Jun 13, 2:09 PM
    • #8
    • 3rd Jun 13, 2:09 PM
    If you have legal cover then you can claim they usually offer 100% compensation.

    Also the solicitors offering 25% you could always offer them say 10% + vat or whatever you are happy with (make sure this is put on the documents not just phone) phone coupl of the ones from tv advertisement I am sure one of them will happily take on your case as they work on volumes rather then individual cases.
    • InsideInsurance
    • By InsideInsurance 3rd Jun 13, 2:13 PM
    • 22,215 Posts
    • 11,383 Thanks
    InsideInsurance
    • #9
    • 3rd Jun 13, 2:13 PM
    • #9
    • 3rd Jun 13, 2:13 PM
    If I had legal expenses insurance on my motor insurance would that prevent the deductions from compensation? I thought that would just cover the legal costs of a solicitor actually taking my case on.
    Originally posted by Randy Watson
    No, it covers the solicitors costs and so you receive 100% of the compensation. Many insurers will try and get you to use the solicitors on their panel rather than one of your own choice but normally this can be argued against as long as your solicitors are willing to abide by the terms of your policy.
    • Voyager2002
    • By Voyager2002 3rd Jun 13, 3:38 PM
    • 13,424 Posts
    • 9,250 Thanks
    Voyager2002
    Of course, the fact that a solicitor is willing to take your case on a "contingency" basis means you have a pretty good chance of winning. So it might make sense to approach solicitors asking to pay in the usual way.

    Of course, if you have insurance to cover legal expenses then that is what you should do anyway.
  • BertTheRaccoon
    If you have legal expenses insurance then look to use the solicitors they will appoint so that you do get to keep 100% of your compensation.

    But if you have no legal cover then you are going to be hard pressed to find a solicitor who will run a claim like this for £500 costs as there is a fair bit of work involved. I would avoid someone who will do it without taking a cut from you as frankly that will just encourage short cuts in my opinion.

    Pay peanuts and you'll get monkeys
    • dacouch
    • By dacouch 3rd Jun 13, 7:15 PM
    • 20,759 Posts
    • 12,858 Thanks
    dacouch
    Solicitor wants 25% of my personal injury compensation
    Originally posted by Randy Watson
    Excellent porn star name
    • Parking Trouble
    • By Parking Trouble 3rd Jun 13, 8:42 PM
    • 637 Posts
    • 222 Thanks
    Parking Trouble
    The £500 limit puts the kibosh on referral fees does it not?

    Admiral made £18.6m from referral fees in 2012 - very lucrative and all passed onto the punters of course.

    So now they are starting a venture with law firm - keep it in the family eh?

    http://www.lawgazette.co.uk/news/law-firm-abs-ventures-insurer-admiral
    Mr Straw described whiplash as "not so much an injury, more a profitable invention of the human imagination—undiagnosable except by third-rate doctors in the pay of the claims management companies or personal injury lawyers"

    • Crazy Jamie
    • By Crazy Jamie 4th Jun 13, 1:27 PM
    • 2,192 Posts
    • 2,117 Thanks
    Crazy Jamie
    It is by no means the case that all solicitors firms will now take 25% of your compensation as a success fee. There are still plenty out there who won't take any of your compensation. Though you should remember that in cases litigated after 1st April 2013 Judges will now be increasing awards for general damages (which related to your injury) by 10%, which is designed to offset the fact that many claims will now be brought on a contingency basis. So in practical terms you're only losing 15% by entering into a 25% contingency fee, and not losing anything if you enter into an agreement for 10% or less.

    It's all the whiplash claims that have helped caused the problem.
    Originally posted by olly300
    That is a drastic over simplification of the issues, which exist on both sides of the fence. Not that it is particularly worth arguing about that now given that the changes are already here.
    "MIND IF I USE YOUR PHONE? IF WORD GETS OUT THAT
    I'M MISSING FIVE HUNDRED GIRLS WILL KILL THEMSELVES."
    • Parking Trouble
    • By Parking Trouble 5th Jun 13, 7:47 AM
    • 637 Posts
    • 222 Thanks
    Parking Trouble
    I am not sure why £500 isn't lucrative enough for the majority of whiplash claims. Insurers fall over themselves to make an early payment so the only dispute is how much the settlement will be.

    You may think a solicitor does your house conveyancing but it is normally an "conveyancer" or clerk that does the work.

    Likewise the ambulance chasers often use ex-claims handlers from insurance companies.

    If the ambulance chasers charged true time and materials they would still make a decent profit out of £500.

    The gravy train has been using a red wine jus for too long when all they deserve is Bisto.

    Just to be clear there are genuine injury cases that need specialist attention and may end up in court. I am just picking on the whiplash epidemic in this country where compo is pretty much forced on people when it is not needed or deserved.
    Mr Straw described whiplash as "not so much an injury, more a profitable invention of the human imagination—undiagnosable except by third-rate doctors in the pay of the claims management companies or personal injury lawyers"

  • weejonnie
    Since legal expenses can be had for about £20.00 (either on motor or household (covering different eventualities)) maybe more people will take it once they realise the potential losses that may now occur. Some organisations also offer legal expenses protection as part of their membership benefits.

    Hopefully those companies that until now had a cosy relationship with solicitors (selling 'legal expenses' but then referring all cases to them) will either be forced out of business or offer a properly underwritten policy.

    Have yet to see if legal expenses insurance premiums will go up.
  • Randy Watson
    It is interesting that there is not much publicity about this. Well, I don't suppose lawyers are going to be quick to advertise that you wont get 100 per cent of the compensation anymore.

    Govt is right to tackle bogus whiplash claims. People aren't going to pay up front for a solicitor to take on their case unless it's genuine - you would think.

    The rule changes only came in recently so it's too early to tell what impact it will have on the general public.
  • Randy Watson
    Since legal expenses can be had for about £20.00 (either on motor or household (covering different eventualities)) maybe more people will take it once they realise the potential losses that may now occur.
    Originally posted by weejonnie
    I wonder how many people even understand what legal expenses insurance is? I reckon most people just see it as an 'add-on' which they don't need.

    I like most people, just try and get my insurance for as cheap as possible so apologies to all for moaning about a lack of cover!
    • InsideInsurance
    • By InsideInsurance 5th Jun 13, 10:26 AM
    • 22,215 Posts
    • 11,383 Thanks
    InsideInsurance
    I wonder how many people even understand what legal expenses insurance is? I reckon most people just see it as an 'add-on' which they don't need.
    Originally posted by Randy Watson
    Before the days of aggregators Legal Expenses used to be on around 90-95% of Motor policies even when it was an optional extra.

    It has always sold well because whilst people dont really understand it they hear they get £100,000 of cover for only £20 so think its a good buy.

    Since the aggregators and price becoming the god emperor (and not just king) more insurers quote without including LE to try and cut every penny they can to get to the top of the list.

    I dont know how the numbers have moved but I imagine penetration is still very high.
  • BertTheRaccoon
    Since legal expenses can be had for about £20.00 (either on motor or household (covering different eventualities)) maybe more people will take it once they realise the potential losses that may now occur. Some organisations also offer legal expenses protection as part of their membership benefits.

    Hopefully those companies that until now had a cosy relationship with solicitors (selling 'legal expenses' but then referring all cases to them) will either be forced out of business or offer a properly underwritten policy.

    Have yet to see if legal expenses insurance premiums will go up.
    Originally posted by weejonnie
    The intermidiaries and insurers selling legal cover who had the "cosy relationships" with solicitors are no longer able to sell on the cases for a referral fee, so instead the insurers and brokers have bought law firms, so rather than rely on referral fees, they just share profits.

    So no reduction in the appetite to shove customers to a lawyer will arise the the claim volume will not reduce. All this has done is box the independent law firm out the picture, who now instead of buying leads for claims from insurers or accident management companies, they have to market themslevs direct to the public - so expect a rise in the number of TV, radio & other media adverts.

    Secondly - legal expenses "insurance" will continue to be the sham it always has been. By this I mean that if a punter who has such a policy wants to chose his own solicitor, he will be told they will not indemnify a non-panel solicitor. Why is this? Well it is because the panel solicitor will have agreed never to claim for any fees from the legal expenses insurer when the claim fails, where as an independent solicitor will want to claim back the hundreds if not thousands of pounds he may have wasted on a client's case that then fails.

    Thirdly - legal expenses insurance - I would expect to see a change to policy terms & conditions appear soon. The reason why? Well, there is strong news that the personal injury small claims limit will rise from £1000 to £5000 soon. The effect of this is that no longer would a solicitor on a successful claim be able to see any costs from the losing party. So if a client has a legal expenses policy, the solicitor would then go back to the LEI and say pay my costs.

    If this happens, legal expesnes insurers will soon have to for the first time in their champertous existence have to actually pay out some legal fees. They won't like that and as a result one of 2 things will happe.

    1- The cost of these policies will rise - result = nobody will buy them

    2- The terms & conditions will change so that PI claims are excluded from the cover and that would mean that lawyers act on a contingency fee basis where you lose a chunk of your damages and no legal costs get paid by the legal expenses policy you have.

    Rumour around the camp fire is that the decision to bring in the new £5k limit for PI cases has been delayed so the legal expenses insurers have time to get their policy wordings changed and avoid exposure to any legal costs.

    To anyone on here, don't believe all the sensationalised hype the Daily Mail spout.
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