Elizabeth Davidson says PI lawyers have vowed to fight for a register of employers' insurers, despite fears of a government cop-out.
INDUSTRIAL disease specialist Frances McCarthy's clients are often dead by the time she is ready to embark on litigation on their behalf.
Like all personal injury (PI) lawyers in her field, the long and often fruitless search for the insurers of companies whose workers have developed industrial illnesses is integral to her work.
Hiring private detectives, placing newspaper advertisements and knocking on doors are all common methods used to find out the names of insurance companies.
McCarthy, a partner at West End firm Pattinson & Brewer and vice-chairman of the Association of Personal Injury Lawyers (Apil), says the cause of many of her clients' illnesses can be traced back to jobs they were doing 50 years ago.
There is no legal requirement for companies to retain employer liability records. So even if an employer has not gone out of business or changed owner several times, it is difficult to find the relevant insurer.
McCarthy reckons she has to abandon 30 per cent of the industrial disease cases she takes on, while a further 20 per cent take two years.
But tantalisingly, an end to the problem could be in sight.
The Department of the Environment Transport and the Regions (DETR) is set to announce a new initiative to make it easier for solicitors and their clients to locate insurers in industrial illness cases. But whether it succeeds is another matter.
The DETR is due to decide which of two possible courses of action it will pursue by the end of the month. Either it will impose a code of practice on insurance companies requiring them to help solicitors locate insurers, or it will set up a national register of employer's insurers.
Unsurprisingly, given their different interests, PI lawyers and insurers are at loggerheads over the best way forward. PI lawyers see the first option as a cop-out, insurers see the second as “unnecessary”.
Both sides have been lobbying the Government in a bid to get their preferred choice approved.
PI lawyers argue that a code of practice is a half-baked solution which the insurance industry will easily side-step to escape liability for industrial illnesses.
Under an existing voluntary arrangement the insurance industry does help solicitors identify insurers.
An Association of British Insurers (ABI) spokesman concedes that a code of practice would simply “codify existing market arrangements”.
But he says this is enough and claims a register would be “extremely costly”, “administratively onerous”, and the task of “running it and paying for it” would be bound to fall to insurers. He says the cost of this will filter down to consumers, escalating premium costs.
In any case, the ABI spokesman argues, the problem is “not that great and only a handful of claimants who would require it”.
He points out that every employer has been legally required to insure its employees since 1972. He says this has eased the difficulty of searching for insurers.
But this thinking is red rag to a bull as far as personal injury solicitors are concerned. For a start, say lawyers, there is no point in companies being required to insure employees if they are not then required to keep records of this insurance.
Leigh Day & Co senior partner Martyn Day blasts the insurance industry's arguments about the cost of maintaining a register as “nonsense”. Day argues that it would be “a minuscule amount compared to all the other administrative burdens in life we deal with” and one easily borne by the industry.
Day claims insurers favour a code of practice because it is more likely to let them off the hook when it comes to claims.
This view is backed up by Thompsons senior litigation manager Nigel Tomkins who claims insurance companies constantly try to wriggle off the hook by denying responsibility, even when the firm has written proof they were the insurers.
He adds that insurance companies can also refuse to accept letters of claim unless they are submitted by the insured party, even when they know that insured party – the employer – no longer exists.
Tomkins says this “outrageous” trick is not confined to a few small insurers but was recently pulled in a Thompsons case by “one of the largest insurance companies in the field”.
Tomkins also dismisses the ABI's claim that the problem is a small one.
A1996 Health & Safety Executive report recorded that asbestos-related diseases had claimed between 3,000 and 5,000 deaths in the previous year, and predicted this would rise to 10,000 per year in the next few years.
McCarthy estimates that about eight million people are currently still working in environments where they are exposed to asbestos. Given this fact, and the increasing levels of environmental pollution, industrial disease cases are unlikely to go away.
According to the ABI, a code of practice on the subject is likely to include some form of sanctions forcing insurers to comply. But personal injury solicitors find it difficult to see how this would work.
After all, insurers would not technically be breaking the law if they refused to comply with a code of practice.
Then there is the problem of how the sanctions would be imposed and who would regulate their enforcement. As McCarthy says: “What possible sanctions could they have and how effective would they be?”
But she does acknowledge that the insurance lobby probably holds more sway with the Government.
Apil plans to continue its campaign for a register – which it first began three years ago – if the DETR does go ahead and adopt the code of practice option.
Apil is clearly bracing itself for the Government to fall in line with the insurers. Which, if Apil is to be believed, is bad news for McCarthy and her colleagues and good news for private detectives.