Personal Injury Claims Without Merit?

Could the Recession Lead to Credit Crunch Bogus Claims?

In a time where everyone is counting every penny and the recession (despite headlines claiming that it's all over bar the shouting) continues to bite, some claims experts are worried that people facing spiraling debts and mounting bills may look for an easy way to make some quick money. Many are warning that the recession could result in a large number of 'bogus or unmeritorious' personal injury claims being taken on by unscrupulous or unsuspecting claims management companies. Although this warning tends to get trotted out every time the economy takes a nose-dive, is there any truth in the scare mongering this time around?

Solicitors in some areas hardest hit by a massive downturn in manufacturing and social deprivation think that yes, this time the threat is real. Some solicitors are already seeing an increase in the number of claims compared to the numbers that they would normally expect, and they also suspect that this trend will continue as desperate people look for ways to find more money. Are the claimants to blame for this feeling of unease amongst some of the more reputable firms or are they also looking 'in-house'?

The concern is that sometimes bogus claims get further in the system than they should do. Solicitors believe their clients and it is only when they evidence does not stack up some time later that they begin to question their client's integrity. Once they realise the claim is not genuine or is being exaggerated most solicitors will drop it immediately.

These bogus claims are likely to fall into three categories; the genuine claim, the willfully fraudulent claim and the unfortunate accident where no actual cause for a claim exists. Partners at a practice in Liverpool have already seen an increase in the number of claims at this time of year and an increase in the number of claims that have been rejected at the first stage of scrutiny. They're basically charting how people are 'trying their luck' at putting in a claim when the incident was a genuine accident and no blame can be apportioned or where they have suspicions about the validity of the claim.

During the last economic downturn in 1990, there was no 'no win no fee' funding for personal injury claims. We had not yet developed the 'claims culture' that the UK has been accused of adopting, since the no win no fee scheme was implemented after the 1990 recession. Heavy-duty advertising didn't begin until a couple of years later, which is when many people started looking more seriously at the situation. Today, the climate is very different. The general public is far more aware of their legal right to compensation in case of an accident that wasn't their fault, but this in turn has created its own monster - the fraudulent claim.

Nobody should be fearful of pursuing a legitimate claim. The law is there to protect those who have been genuinely affected by an avoidable and preventable situation (translation in ad-speak: an accident that wasn't their fault) or because of someone else's negligence. What is of concern is that some less scrupulous people may see the current economic climate and people's desperation to access finance (now that the credit card lifeline has been cut off) as an opportunity to milk the system. It is a time for solicitors to be extra vigilant when assessing the merits of a new claim.

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