PI Brief Update

Can it be true that 25% of PI claims are fundamentally dishonest? - Dr Mark Burgin

25/10/24. Dr Mark Burgin questions whether the explosion of Fundamental dishonesty can be justified by the recent changes in the PI industry.

It has been reported that CJCA 2015 S57 Fundamental dishonesty is now raised in up to 25% of PI claims. Insurers have kept quiet about the number of successful uses of S57 but it is not likely that they would continue without some success. Solicitors who defend claims have fallen silent after an initial period of giving numbers such as 500 cases in 2019.

Experts are aware that many Part 35 questions appear to be raising questions about honesty. The complexity of these questions has been discussed in previous articles and there is some concern that inexperienced experts might struggle. The time constraints and diminishing fees mean that it is difficult to provide a detailed response.

The insurance companies do not appear to have any help in their work from experts. The reported levels of success are higher than would be expected. Spotting a dodgy report requires inside knowledge of how they have been created. Previous attempts by insurance companies to challenge reports did not have anywhere near this level of success.

Claimant solicitors and claimant groups have not found any approach to prevent S57 being raised or address the issues. This has led to a chilling effect on the whole industry with defendant solicitors discussing the impact of high-profile cases on claim levels. This article asks the question at the heart of the problem, whether fraud is really as common as the insurers say.

The rise of mixed injury cases

The most compelling evidence for fraud comes from MedCo’s own figures which confirm a rise from 20% to 70% in the proportion of mixed injuries. This rise cannot be attributed to any change in the type of accidents as non RTA are excluded. The additional fees attracted by non-whiplash claims was recently at the Supreme court. The tariff fees are often dwarfed by the non-whiplash claims and give a clear motive for their inclusion.

The claimants will often insist that their neck pain radiating into the upper arm and pins and needles in the hand are all different injuries. This in turn is causing an increase in challenges to experts who suggest that referred pain is not separate to the origin. There is no completely objective way of challenging a claimant’s opinion on attribution. Some claimants will go further and remember an impact of the area with a part of the car even if that appears to be implausible.

Even if there was previously substantial under-reporting of non whiplash injuries it is difficult to see how so many people can suffer these new injuries. The mechanism is often low velocity and the force was not sufficient to cause direct impacts. My cases do not confirm any changes to the pattern of injury so it is likely that up to 50% of claims contain some element that cannot be substantiated.

Experts

Experts should provide a barrier to FD cases by considering whether the injuries complained of are consistent with the mechanism. Experts used to consider medical records and arguably the presumption against review should be reversed. The expert who unquestioningly accepts the claimant’s version of events has always been a magnet to some solicitors.

Experts have been talking about new administrative agencies (boiler rooms) that offer to write their reports for them. For a lower fee than normal the agency prepopulates the report with all the medical data. The expert then just has to ‘touch the neck and write something.’ Many are new experts who join MedCo as DMEs and then have thousands of cases a year. 

They undergo MedCo training but do not have Bond Solon training and are told ‘The secretaries are very experienced and they can tackle amendments and part 35 questions and you will not need to deal with these’. MedCo has confirmed that it is aware of the problem and intends to take action in the near future. In the meantime it is likely that there have been and will continue to be many reports that do not challenge the claimant’s version of events.

The current estimate that about half of all the cases are being undertaken in these boiler room BR conditions. Even assuming that all other experts are not inflating claims and only 50% of these BR cases are inflated that means that 25% of all PI reports will be fraudulent. If the remaining experts are being pressured into the same type of behaviour by bad actors, the figures could higher.

The rise and rise of case handlers

The PI industry used to be mainly run by solicitors as the complexity of the cases made them difficult to delegate. Fixed fees and the tariff system has meant that it is financially impossible lawyers to run these cases. A senior lawyer remarked in a meeting that there was ‘not enough cognitive power’ left in PI to deal with the issues.

The behaviours of case handlers have deteriorated with many said to have instructed experts to extend prognoses. Experts are often faced with multiple questions on the same report which puts them under pressure to agree to changes. Case handlers have been emboldened by the BR saying ‘Always make any amendments solicitors ask for because if you don’t they will cancel the case and take their business elsewhere.’

The case handlers struggle to get supervision and when they ask for help the solicitors rarely have the time to sort out issues. I have been sent several claims where the disbursements have become so bloated that there is no chance that the value of the claim will now sustain the costs. The case handlers report that the case was being run by a now departed colleague who misjudged the case.

There is likely to be an element of competition between case handlers as the glow of higher settlements will become a performance metric. The problem is that currently cases are taking years to settle so the predicted quantum may not be realised. Equally many cases that are going to found to be fraudulent will have been running for years and only when the chickens come home to roost will the costs be accrued.

Conclusions

Rough estimates of fraudulent cases from three separate sources would suggest that 25% is a reasonable estimate. The reputation of travel claims and disrepair claims has already been damaged by previous public scandals. It appears that RTA claims are going the same way unless there is a prompt and robust intervention. Many of the most experienced and talented experts are reducing their workload or leaving completely.

The Daily Mail has been unusually quiet on the topic of fraudulent claims and are likely investigating for an exposé. The scale of the industry’s problems is difficult to hide and the MOJ appears to be content with the current decline. Judges are becoming increasingly prepared to challenge experts who fail in their duties. A perfect storm is approaching and simple steps to solve the problem are obvious.

The OIC portal has been extraordinarily effective with litigants in person achieving higher payouts at shorter timescales than those who are represented. Claimants are generally put off by the boiler room tactics and many are choosing established experts who prepare high quality reports. These experts are happy with the payments which are higher, paid promptly and with less chasing. The claimants do not have to pay the 25% success fee and their risk of S57 is minimal.

The MROs and experts should be told that they must not use boiler rooms or lose access to the portal. The OIC should be made so that direct to expert is given equal weight to MRO. Where high numbers of medical reports are flagged as fraudulent then interviewing the claimants should indicate if the correct procedures have been followed. It should not be necessary to contact the police or the GMC as bad actors will leave as soon as the gravy train stops.

Doctor Mark Burgin, BM BCh (oxon) MRCGP is a Disability Analyst and is on the General Practitioner Specialist Register.

Dr. Burgin can be contacted on This email address is being protected from spambots. You need JavaScript enabled to view it. and 0845 331 3304 website drmarkburgin.co.uk

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