Is standardisation the solution?
'We will always have to consider local rules, laws and culture'
Michael Faure's research draws a comparison between the personal injury settlement systems of four countries. Belgium, Ireland, and Sweden, all three of which have some form of standardisation and norming. And the Netherlands, which mainly has an individual approach to personal injury. Ian Bearpark, Country & BD Manager CBC, answers 5 additional questions.
#1 Is standardisation in personal injury the future?
Ian: 'Belgium, Sweden, and Ireland are exceptions for the time being. Most countries in Europe do not have a standardized process and standard for handling personal injury claims. The individual approach does not always lead to problems; 80% of the cases are solved without any problems. However, they require more negotiation and, therefore, time. Eliminate negotiation and discussion through a form of standardization, and you will save a lot of time! Moreover, standardisation offers more clarity and certainty for all parties. Michael Faure's conclusions are clear on this. The Dutch Association of Insurers is therefore looking for options for (partial) standardisation. In any case, a compensation table and perhaps the creation of a Board? Reforms are also underway in the UK, with more transparency as a first step in the hope of faster processing.'
Ian Bearpark
#2 Can a system like in Sweden be copied by other countries?
Ian: 'A well-functioning system in Sweden cannot be taken over one-on-one by other European countries. You should always consider the local rules, laws, and culture. If you want to implement such standardization successfully, it is important to involve all parties from the start. It only has a chance of success if there is consensus between them. In addition, once some form of standardization is in place, it must be kept up to date. In Spain, for example, there is a table whose fees have not kept pace with inflation. That damages trust in a system.'
#3 Which countries are the red flag in personal injury costs?
Ian: 'The United Kingdom, Germany, and the Netherlands are red flag countries, countries with the highest compensation. You can see this in the graph below. It is not about the actual physical damage ('pain and suffering') because those costs are about the same in all countries. Only in Italy are those costs higher, a cultural aspect. The biggest difference is in the costs for help and medical costs. These costs vary considerably from country to country. As well as the 'loss of income' is simply due to the difference in living standards and therefore salaries. And the 'rest', such as the legal costs. Those are differences that will remain. Just like inflation, which continues, but not at the same rate in all countries.'
#4 How can we best deal with the current practice?
Ian: 'Deal with what you have and make it work in the best way. Understanding that the process differs in each country is key. Why they deal with things in a certain way, what legislation is involved. There our worth shows; we'll keep an eye on it all. At the same time, we emphasize to our customers to be transparent. By creating openness between the various parties, you can settle much faster. We need to see if the number of personal injury claims increases again as we put the Covid pandemic behind us and get back on the road and travelling.’
#5 How do you define CBC's role in all of this?
Ian: 'Our role is even more important where there is a lack of standardisation. One of the negative consequences of the lack of standard compensation is that people often claim as much as possible. But, thanks to quick and thorough research by our colleagues, we can save a lot of money. Especially in the United Kingdom, those savings add up. See two recent successes below.'
Bereavement claim
A woman has filed a significant claim for damages over her partner's death following a car accident. As always, the CED colleagues search the Internet for supporting information. They found the claimant on social media that she had had a baby within a year of her partner's death. It turned out that she had this baby with a new partner. And if she's in a relationship, she can't claim damages for bereavement, earnings, and service dependency. The claimant stated that the ‘new’ relationship was over. But the CED colleagues found out that wasn't the case at all. She was even pregnant with a second child. We advised the claimant to withdraw the remainder of her claim, as we promised that we would not plead fundamental dishonesty against her in court. It saved the insurance about a million pounds.
Overtime claim
A motorcyclist filed a claim after being knocked off his bike and injuring his foot, ankle, knee, shoulders, and wrist. He filed a major claim for loss of past and future earnings, overtime, and pensions, as well as care and rehabilitation. He claimed he was unable to work extra overtime as a train driver. We got proof that he was working and going to the gym, plus an expert report saying he could work until retirement age. We also explored whether overtime might not be available due to more people working from home. The court allowed our evidence, and the claimant accepted our offer – the result: a saving of £640,000.