Legal Blog

The Good, the Bad and the Ugly

It’s hard to know whether things are improving or getting worse in the world of Personal Injury.

On the one hand we’ve had the recent news that the Small Claims Limit will remain at £5000 for the time being at least, which has got to come as a relief to many.

On the other hand the SRA are issuing warnings to PI firms about deductions from client damages. Surely this was the trade off in cutting Fixed Fees, a transfer of cost from Insurers to Consumers, no one can still reasonably believe that firms can create new enquiries for RTA claims, sign them up and process them to a reasonable level for £500 can they?

Then we hear that MoJ is going to crack down on pre medical offers by Insurers – surely good news. But also crack down on inducements from law firms – is that bad news – its hard to tell. I’m still not sure firms can really afford to pay inducements within the new Fixed Fee environment anyway?

The really ugly news though is that 150 firms have not been able to secure PII by the deadline and many will inevitably have to close. This is surely a sad reflection on the Law Society/SRA for closing the Indemnity Fund and expecting the open market to deal with PII – after all they are Insurers. We also hear of firms facing 30% + increases in premiums which makes British Gas’s price increases look positively reasonable – but of course there is no public outcry – who cares if more firms go to the wall?

If you do have to get out of course there are plenty of firms scrambling to acquire cases, although SGI warns that the value of WIP is rapidly decreasing as the older, more valuable cases are settled. There are of course alternatives to outright sales like those provided by PI Solutions, for firms who can afford to wait.

Finally on a marketing side – the ugly. More and more SEO Agencies promising number one rankings overnight. It can’t happen and even if it does it will be short lived as Google is again on the war path against SEO. Please stick with your current providers, I’m sure they are doing the best they can in a competitive and ever changing market. If someone tells you they can get you to number one quickly they can’t.

Personal Injury Marketing, Personal Injury News

“Super firm” launched!

We hear this week that a former Quality Solicitors Customer Relationships Manager has launched a new “super firm” 1Solicitor.

It seems that 1Solicitor will be offering firms the chance to take advantage of its Customer Relationship Management expertise and get the benefits of its software designed to improve firms’ communications with their existing client base.

Firms will also work with their existing branding and be able to use the 1Solicitor model for £800 a month – plus a £3000 Joining Fee.

They are of course right to point out that it is much more cost effective to retain existing clients than to generate new clients – quoting a £10 against £100 cost comparison. I suspect many law firms would quite like new clients for only £100 – I suspect in many legal markets the cost is much higher.

Of course this is not a new idea and one that has been working on with its clients since the beginning.

Seems there no such thing as a “new idea”.

Legal Marketing, Online Legal Marketing, Personal Injury Marketing

More Referral Fee shake out

Many observers of the PI Market will no doubt have smiled wryly a couple of weeks ago at news that the SRA has refused a number of ABS license applications which in its view seemed to deliberately flout the Referral Fee Ban. Examples were cited of business models allocating share return directly linked to the number of cases and it was intimated that these models were being presented by Insurers rather than dreaded CMC’s.

Unsurprising perhaps, considering that Direct Line announced last gasp earnings of £6m before the Ban came into effect, bring its total Referral Fee income to some £125m since 2009. No doubt the business does need some sort of ABS to keep this lucrative income stream flowing – as it seems it helped Direct Line reduce overall premiums by 3%

ABS, Personal Injury News, Referral Fee Ban

Summer Moves

Although usually quieter months for the PI Market, the summer months have seen a number of moves no doubt following on from the introduction of the LASPO measures earlier in the year.

Slater & Gordon, owners of the Claims Direct brand, having taken over RJW last year have now announced the acquisition of Fentons, to add to Taylor Vitners and Goodmans already purchased earlier in the year.

Not to be outdone, the recently transformed into an ABS SGI legal in Liverpool announced that it had bought the PI Department of the recently demised Midlands firm Challinors.

Major North East firm Winn Solicitor also announced the sale of a majority equity stake to private investment companies JZ International and Souter Investments.

With PII renewals set to impact many smaller PI firms in the next few weeks no doubt there will be more acquisitions on the horizon and no doubt some more firms closing their doors

Personal Injury News

Clinical Negligence Enquiries available

The latest NHS Annual Report revealed that the number of new Clinical Negligence claims rose by 10.8% during 2012/13 to 10,129 cases, a 66% increase over the past 4 years.

Spending on Clinical Negligence claims rose to £1.2b in the same period.

The increase has been blamed on the end of Legal Aid, but in the light of the recent Keogh Review into hospital death rates it may just be a sign that the general public has lost faith in the NHS are more inclined to bring a claim for negligence. In turn many firms are increasing their expertise in the area of Clinical Negligence claims and in turn many are looking for ways to increase their marketing activity to generate new enquires.

The Clinical Negligence Advice Helpline is a well established marketing company, who have been successfully marketing both on line and offline for Clinical Negligence enquiries, for many years. Firms on the panel pay a monthly Marketing Fee and in return Clinical Negligence Advice Helpline generates enquiries on a carousel basis. A number of firms have been using the scheme to market enquiries for many years now, helping them build successful Clinical Negligence Departments.

If you would like to know more about the scheme, please contact Prima Legal Marketing for more details.

Legal Marketing, Personal Injury Marketing, Personal Injury News, Solicitor Marketing

Bogus Legal Internet Marketing Scheme

News from the US, where a law firm is suing the provider of an internet marketing service under the “Racketeer Influenced and Corrupt Organisations Act” – sounds serious.

It seems that the marketing company took money with a promise to increase the law firm’s visibility on Google, but it turns out that the company were using Search Engine Optimisation (SEO) methods, which were in violation of Google’s rules – and subsequently the firm didn’t see any tangible results.

However, it appears that the marketing firm were actually “selling” a link farming scheme with the promise of turning firms from Google zero’s to heroes almost overnight.

Strikes me that the law firm got what it deserved for investing and participating in a “get rich (ranked) quick scheme” – most commentators seem to think that the action is doomed to failure.

It a salutary tale, however and one which should be remembered here in the UK when firms embark on SEO projects. Anyone promising results within weeks or even months should be viewed with caution. There are no get ranked quick SEO schemes. Google mission is to destroy these schemes and those who participate in them. SEO is a long term process which requires patience and investment over 18-24 months at least. The only real way to achieve longevity in the rankings is to work and grow your website within the rules Google dictates, not cutting corners for a quick fix.

Legal Marketing, Online Legal Marketing, Personal Injury Marketing, Solicitor Marketing

War of words continues between PI Firms and Insurers

It seems that FOIL has objected to the recent Law Society “Don’t get mugged by an Insurer” campaign. Apparently they find the campaign “saddening…unfortunate and misguided on several levels” and are surprised the Law Society is offending a significant number of its own members, namely the defendant insurer firms. Unsurprisingly FOIL’s pals in the ABI had no such concerns when they pressed for the Jackson reforms which meant that their ATE insurance member’s business models would be decimated. FOIL is probably also shocked that the Law Society has finally found a voice in support of its members in the PI Sector, even though they’ve already been steam rollered by LASPO.

They also claim that the data quoted by the Law Society to back up its claims of understatement is out of date, relating to an FSA report produced back in 2009 which apparently only used data from three insurers. Meanwhile, AXA Insurance produced proposals last week to reduce exaggerated and fraudulent whiplash claims, which it says should be made within three days of an accident and include supporting MRI Scans or X Rays to support any claims – knowing full well of course, that neither of these is likely to support evidence of soft tissue damage. Apparently the AXA proposals rely on evidence from France where whiplash only accounts for 3% of injury claims. But wait a minute, we are now told that evidence came from a 2004 report and today’s figures are more like 30% of claims. Who can we believe, when there are apparently so many conflicting reports available?

Of course Insurers can rest more easily again, as the new stricter rules governing CMC’s came into force on 8th July. CMC’s must now enter into written agreements with their clients before charging any fees and inform clients if they are suspended or have any restrictions imposed on their license and most importantly, they now have to advise clients that they are regulated by the CMR rather than the MoJ. Undoubtedly, this will reduce the number of claimants using CMC’s won’t it!!

Pretty much no CMC’s have previously deducted charges from PI Claimants because there’s been no need, but now that Referral Fees are banned, there’s obviously every need to have a written agreement as many CMC’s are now moving onto some form of legitimate contingency arrangement – given that the claimant is now paying for both the solicitors success fee and the CMC’s Referral Fee.

Finally, a good letter in The Gazette from my pal Dominic Moss at who quite rightly points out that there is a lot of potentially misleading advertising going on by law firms, either purporting to offer 100% compensation when they won’t or offering advance payments as inducements, when actually theses offers are contingent on admissions, medicals and special damages which means in most cases there won’t be an upfront payment at all.


Personal Injury News, Referral Fee Ban

“Inducement” Marketing can continue

The SRA confirmed last week that it would not be banning solicitors from offering inducements to clients, unlike the ban placed on CMC’s, as long as the advertising of “inducements” is not inaccurate or misleading.

It seems the SRA having considered the issue, decided that the use of incentives to attract clients did not have any adverse affect on clients.

Perhaps surprisingly the decision has drawn broad criticism from claimant PI groups including APIL and MASS, who both wanted a ban to be imposed. The APIL suggestion is that the offer of inducements acts a distraction to clients from choosing the most appropriate solicitor and MASS warned that the continued use of inducements did nothing to combat fraud and the “have a go culture”. I’d probably agree, but surely inducements are a legitimate marketing toll which can be used by solicitors to attract enquiries. Whether they are commercially sensible in the new costs regime is another matter altogether. But with solicitors facing a downturn in business on the back of the Referral Fee Ban, surely having some levers to attract claimants will help?

We’re getting conflicting reports about the effects of the ban. A report from the Institute and Faculty of Advocates, reported an increase in the number of accidents involving bodily injury, despite an overall fall in the numbers of accidents generally. This relies on historic data, perhaps more significant are the latest reports from the Portal, which indicated that new RTA claims had reduced by 31% since April, down 25% on last year. This probably more accurately reflects the real figures but does put potentially more pressure on the Government and Insurers to reduce premiums as a result.

Does this dramatic fall in claim numbers point to an effective justification of the Insurers position, or does it reflect a genuine reduction in access to justice for claimants. If there are 30% less claimants, then law firms really are in for a tough time and maybe they will need to be able to offer inducements to get a slice of the ever decreasing pie.

Inducements do work of course, not necessarily the “free gift” style offers employed by some firms, but a small referral bonus to reward existing clients has proved very successful for a number of firms that Prima Legal Marketing works with. Done properly this type of offer can create client enquiries for less that £300 each, which is significantly cheaper than some other direct marketing campaigns.


Legal Marketing, Online Legal Marketing, Personal Injury Marketing, Referral Fee Ban, Solicitor Advertising, Solicitor Marketing

Personal Injury Marketing cranks up.

In a move that many would see as too little too late, the Law Society has announced the launch of a £300,000 marketing campaign to spell out the benefits of using a solicitor. The adverts using the “Don’t Get Mugged” strap line – spell out the benefits of using a solicitor over an insurance company, claiming that on average the client will receive 2-3 times more compensation.

Apparently the ad will run on posters and for the first time the Law Society will be testing radio adverts and adverts on You Tube. I suppose PI firms should be grateful for any support from the Law Society, but compared with recent announcements by the Co-Op Legal Services that it is launching a multi million pound campaign and even regional law firm Fletchers announcing a £1m advertising campaign, one wonders how much impact the Law Society campaign will have.

Moving into the world of direct advertising of course is not necessarily as straight forward as some firms might think. Only last week the Advertising Standards Agency reprimanded Ultimate Law and ordered it to with draw its radio campaign, which the ASA felt had breached the rules on Social Responsibility by apparently seeming to suggest that accident victims could claim compensation regardless of injury.

Ultimate Law apparently argued that their advert didn’t mention claiming compensation specifically for injury as they offer accident victims services other than PI. That sounds reasonable but not in the ASA’s opinion. One has to wonder who actually made a complaint to the ASA about the advert in the first instance and on what grounds. Could you really see an ordinary member of the public objecting to such a suggestion…..” I couldn’t believe my ears, a law firm was suggesting that I should call them after being involved in an accident… they might as well have been advertising crack cocaine to my 8 year old”….H’mm more likely someone from one of the Insurers took offence at the suggestion that a lawyer should get involved in ensuring that an innocent third party gets properly treated after being involved in an accident which wasn’t their fault.

Anyway, the final news story recently, related in a sense to the whole topic of personal injury marketing, was the amazing press release by Epoq, saying that they had found a compliant way for CMC’s to work within the LASPO rules. They have apparently launched a new scheme called Legal Go which allows CMC’s to record claimant details on to a system, the get the claimant to call a law firm “direct” and then bill the law firm for the “referral” – brilliant – and this was put out in a press release. I know the SRA are slow, but surely they’ve visited Epoq’s offices by now to find out who’s using the scheme!

Legal Marketing, Online Legal Marketing, Personal Injury Marketing, Personal Injury News, Referral Fee Ban, Solicitor Advertising, Solicitor Marketing

Claims Companies under attack.

“CMC’s should be closed down – as they serve no purpose”, that was the message Des Hudson, Law Society Chief Executive, gave to the Transport Select Committee recently. That message was followed closely by an announcement by Kevin Rousell, Head of Claims Management regulation at the MoJ, that CMC’s who were under investigation would be named and shamed on the regulators website – to give consumers peace of mind.

War declared on CMC’s then – great timing of course, coming just after the Referral Fee Ban has been introduced, seeing 100’s of CMC’s close down of their accord.

You have to wonder about the logic of these latest statements. If CMC’s served no purpose, why would so many consumers choose to contact them to discuss their claim rather than calling solicitors direct? Without CMC’s in the post LASPO world I wonder how many also know how much individual claims are costing them as they set foot in the new world of direct marketing?

As for naming and shaming CMC’s who are subject to investigation, I suppose that’s a fair move, considering the current justice system already allows the names of alleged offenders to be broadcast across our national media, years before any formal charges are often even brought.

I’m not pro CMC’s nor anti CMC’s – I think they do a job in terms of marketing for potential claimants and they often do that job in a more cost effective way than many solicitor firms can. I don’t think they act to the detriment of the clients claim, as historically very few have made any direct charges to the client. That’s all changed with LASPO of course, opening up Damages Based Agreements and allowing law firms to deduct fees from client damages, which they legitimately need to do to make any margin from the reduced CMC’s. Funny that isn’t it. Before the cut in Fixed Fees when CMC’s were wide spread, the client was not at any disadvantage, now after the cut in Fixed Fees, CMC’s are on the wane and clients are having their damages cut left right and centre.

Legal Marketing, Personal Injury Marketing, Personal Injury News, Solicitor Marketing

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