The costs for personal injury claims could increase as a consequence of government proposals to implement a complete ban on referral fees.
Under the current system, personal injury solicitors often pay fees for referrals from insurers and claims companies, with those costs being ultimately passed onto the client.
But the legal community believe the new proposals, which are due to come into force in 2013, are too ambiguous and believe they amount to being “an insurer’s charter.”
Writing in the Law Society Gazette, John Spencer of Spencers Solicitors, Chesterfield, believes they will create a system which will function as a referral fee in everything but name, restricting the freedom of choice for the consumer while the independence of the personal injury legal sector will be jeopardised.
“When details of the ban were revealed it became demonstrably clear that they were inadequate and constituted nothing more than an insurer’s charter,” said Mr Spencer.
“No heed has been paid to the fact that alternative business structures will undoubtedly be a significant part of the legal landscape when the ban comes into force.
“Coupled with this oversight is the ambiguous wording of the ban itself, failing as it does to preclude insurers in particular from creating a model which can function as a referral fee in all but name.”
The practices of some claim companies have also come into question with one member of the Francis Alexander Solicitors firm, a leading light of the Heaton Mersey business community, receiving a bogus call from someone claiming to represent his motor insurance company and referring to an accident that did not happen.
Consumers can be protected from additional fees and these type of practices by going directly to a solicitors specialising in personal injury claims like Francis Alexander Solicitors. By going directly to them, the need for additional costs is greatly reduced.
Francis Alexander Solicitors can be contacted on firstname.lastname@example.org or by ringing 0161-432-3633.