A perceptual shift must occur within the industry as well as across the public and the legal profession to replace cash in personal injury claims with care, argues Andrew Pemberton. Without it, the UK will struggle to escape the blame-and-claim culture and pursue a course of individual responsibility.
Lord Young's recent paper Common Sense, Common Safety, has for many addressed the elephant in the room around so-called compensation culture.
Accepting risk as a part of everyday life and encouraging responsibility to be taken by individuals, rather than offloading it to others, might sound like wishful thinking to some. Yet it is possible to create a shift in society's perception either through a single seismic change, such as in the legal requirement of seatbelts for drivers, or through creeping legislation, which is where Lord Young's report has arrived.
A psychologist will explain that to change behaviour you first have to change beliefs. As long as risk is perceived to be bad and risk management is the responsibility of others, the current situation will continue. Every time an individual is told what and how to do something by a third party, it simply reinforces their belief that there is a greater authority that has thought through their health and safety for them, enabling them not to have to think about their circumstances.
Case in point
A recent pilot scheme decluttered Kensington High Street by removing barriers and simplifying road markings, requiring pedestrians and motorists to think as they used the junction. Pedestrian accidents in the affected area have been reduced by more than 40% since the changes.
No doubt the changes proposed by Lord Young, if implemented, will go some way to help change people's perception of risk and their personal responsibility, but the problem is more complex than health and safety or the personal injury system: it requires broader, cultural changes in the tax system, healthcare and education.
In the real world of rehabilitation within personal injury claims, what does Lord Young's report mean? The move towards damages-based agreements might have some impact on the viability of marginal cases, which will inevitably lead to debate over access to justice. This in turn could lead claimant solicitors to simply accept rehabilitation as provided by insurers rather than take more active involvement themselves in selecting and managing providers.
Will a solicitor funded by these damages-based agreements fight for the best possible rehabilitation for their client when faced with an off-the-shelf insurer-backed solution? No doubt insurers would argue this is a good thing, but some caution is advised.
In the corporate environment, the extension of the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations to seven days might, on the surface, seem a retrograde step in the fight for early injury notification. In reality, with 50% of cases not being reported, it would seem like a reasonable step to link Riddor to doctors' certificates.
The real challenge here is to provide incentives for employers to report at all. Although a legal requirement, Riddor currently offers no incentive to the employer — just bureaucracy and the threat of investigation by the Health & Safety Executive — so it is amazing that even 50% actually report.
If the government wants to reduce the bureaucratic burden on employers, improve their efficiency and bring about genuine benefits to safety and claims culture in this country, the Riddor notifications should be automatically directed through to the firm's employers' liability provider, which can then support them with risk management and rehabilitation services.
This approach represents a low cost, simple-to-implement, win-win solution.
Compare the current personal injury situation with home contents claims. In the latter scenario there is a sophisticated customer care experience. Tradesmen appear on site to assess the damage, replacement products are delivered, credit is given at high-street stores to spend and on-site repair services are organised — all from one phone call. The claimant is actually treated as a customer and not a victim.
Why then does the same insurer, when faced with an equivalent personal injury claim, simply send out a big cheque and tell the victim to sort themselves out? Well, of course, that is the system and not just the insurer's fault, which might not even know about the victim's 'loss' for hundreds of days post-injury.
If the market seriously wants to stop personal injury claims being perceived as a source of payout then the easiest thing to do is start giving care and not cash to the customers. There will be times when only money can compensate for a loss of function or suffering, but if we are talking about changing the culture of society — and not just for a limited few — a system must be created that works on a large scale for the majority in order to permeate the psyche of the masses.
Rehabilitation, while more prevalent now than 10 years ago, is still used as tool of conflict by both claimants and defendants and there is nothing in the Young report to change this.
Take the case of the claimant solicitor who instructs a rehabilitation assessment towards the end of a case, simply in the hope of bolstering the head of claim rather than intending to deliver any care. Or how about the insurer that agrees to fund rehabilitation to make an early offer of settlement rather than actually deliver any care. Where care is being replaced by cash, it helps to fuel the compensation culture.
If Lords Jackson and Young are serious about stemming the culture of injuries being worth cash, the insurance industry has to take some bold steps to replace cash with care. Fiddling around with the processes under which claims are made is like rearranging deckchairs on the Titanic.
Andrew Pemberton is a director at Argent Rehabilitation
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