Scottish solicitors’ firms have to do formal risk management training every year.
This is particularly to minimise the risk of making mistakes which might mean we end up getting sued because of losses we might cause to our clients.
We had a recent session in our Elgin office where the “system” to assess risks in our work on a daily basis was summarised as:
- Stop and think
- Do as you have been told (i.e. we have a lot of systems and procedures already for managing risk)
- Repeat one and two
Everything looks clear with hindsight. You want to avoid looking back on things with regret, if possible. It can be especially annoying if, due to not “stopping and thinking”, you make a silly error which results in a loss to you personally or to your workplace.
It’s a bit like that with personal injury claims and, from our perspective, there is an avoidable mistake many injured people make at the start of their personal injury claim. It causes financial loss to them. It’s not obvious, though, and that’s the point of this article – so you know, in case you are ever that injured person who needs to make a personal injury compensation claim.
In this article, we’ll consider 3 things. What is the problem we’re referring to? How much does it cost you, if you get it wrong? And, finally, how do you avoid the problem?
The problem of throwing money away.
At a recent meeting with a personal injury client, we were discussing the value of the claim.
There was no dispute from the other party’s insurers that compensation should be paid; the value of the claim was the only issue in dispute.
Due to language problems, another family member was present and translating for our client. When we got to the value of the claim, the relative assumed that there would be a deduction from the final compensation to pay legal or other costs, or at least some of them.
The relative had recently had a successful personal injury claim of their own, through other solicitors. Their solicitor had deducted about 25% from the final compensation, so they only received about 75% of the agreed value of the claim.
We explained that this was not how it worked with us. The value agreed with the third party insurers (assuming it could be agreed) was what our client would actually receive in their hands.
This was a surprise to the relative. You could see the dawning realisation that they had probably “thrown away” 25% of the value of their own (already settled) claim. And it was too late to do anything about it.
How much are you throwing away?
It depends on the arrangement you have with your solicitor.
In the relative’s case, above, though the personal injury claim was an uninsured loss and not really the concern of their own motor insurers, those insurers had “helped” by referring the relative to a firm of solicitors they knew. We can’t know this for sure but there was probably a pre-existing arrangement between the insurers and those solicitors – possibly even a referral fee arrangement, with the solicitors paying something to the insurers for the referral of the personal injury claim.
On successful conclusion of a personal injury claim, the solicitor for the injured person usually gets paid a fee by the third party insurers either under the Compulsory Pre-action Protocol (if the claim settles before a court action is required) or under Judicial Expenses (if the case has had to be raised in court before it settles or is decided by the court).
The 25% proportion mentioned above is in addition to these fees.
How do you avoid the problem?
First of all, stop and think.
You now know that you don’t have to use the solicitors your own insurers suggest. Think: why are they suggesting you use solicitors who are probably quite far away from you and you can only communicate with by phone or email?
In “doing as you are told”, be aware that an alternative procedure is available. Why not contact a local, specialist solicitor and see if they can help you – and how much it would cost?
If the insurer’s panel solicitor is not going to charge the 25% (or however much) additional amount, there’s not much to choose between a local solicitor and the panel solicitor. But at least check that point, if you can.
Too many people go along with their insurers’ suggested solicitor because “they must know best” and/or “they have my best interests at heart”. But they don’t, necessarily.
The 25% deduction is often fixed and in place before many people are aware it’s there at all – and, by then, it’s too late.
For example, if your claim is worth £4,000, you’ve potentially thrown away £1,000 of that amount.
You need to know that losing a percentage of your compensation in a personal injury claim is not inevitable.
Armed with that knowledge, if you ever need to get help with a personal injury compensation claim, stop and think.
Check whether the recommended solicitor to help you is truly going to be the best option for you. You don’t have to use the solicitor suggested by your own solicitors. Speak to a local, specialist solicitor and see if they can help you. They may have a number of advantages for you over the insurer-nominated solicitor – not least an immediate gain in the proportion of your compensation you will receive at the end of the claim.
In many cases, it should be possible to get 100% of your money, without deduction. It’s worth finding out, before you are tied into an arrangement that means there will definitely be a loss to you from your compensation.
How we can help
We hope it’s been useful to find out how to avoid throwing money away on your personal injury claim. This article probably covers the “number one” reason people throw money away needlessly; other ways exist too.
If you have a possible personal injury claim and you think a free case assessment is something which would be helpful to you – and that we would be local solicitors from your point of view – get on and send us a Free Online Enquiry.
The sooner that someone gets started on the process of investigating and analysing your claim, the better for you.
Our aim is to help people in Moray to claim fair and full compensation for personal injury in such a way that it costs you nothing, whether your claim succeeds or not. We are specialist, accredited solicitors – at Grigor & Young LLP, Elgin.