PI firms come together to take on claims companies

Jon Robins looks at PI firms’ pooling of resources to challenge the dominance of the ‘short-changers’

If ever there was a moment for beleaguered claimant personal injury (PI) lawyers to collectively pick themselves up off the floor and dust down and renew their fight with the claims management companies, it is now.

The once all-conquering claims companies are looking vulnerable to say the least. The market leader, The Accident Group (TAG), is ensnared by some nasty litigation and last week was subjected to the unwelcome attentions of the BBC’s Watchdog programme; and Claims Direct, currently in receivership, is rapidly sliding into history.

But sadly, missing opportunities has proved something of a habit for the profession, not least in the high street practice (remember conveyancing?), where the likes of Claims Direct and TAG have made their presences felt most strongly.

“We managed to miss the boat the first time round and allowed those companies to take the market off us very quickly,” comments Martin Twambley, a partner at Manchester firm Amelans, which took on the insurance industry in the leading cases of Callery v Gray and Sarwar v Alam. “We’re now being given a second bite of the cherry. We have to get real and seize the day.”

‘Getting real’ in this context means joining up with your professional peers and fighting the common enemy. Amelans, which this year was Niche Firm of the Year at The Lawyer Awards, is one of 35 firms in a new national network of 35 leading PI firms that plan to fight the claims companies on their own terms. For example, the initiative – which is expected to launch formally this week – will feature a major TV advertising campaign going out to an audience of 6.5 million every day.

This time the message is not just stopping at the big firms; instead, it appears to be percolating all the way through the profession. For example, 11 Kent firms launched their own marketing group, Kent Accident Link, last month, and more recently 14 Blackpool-based firms have joined up to create the Fylde Solicitors Consortium (FSC). Both groups were born out of the frustration that accident victims were more likely to go to the claims companies because of their ‘where there’s a blame, there’s a claim’-style adverts than a solicitors with a presence on the high street.

“We think the public’s been short-changed,” argues Stephens & Son partner Jacqueline Shicluna. “They deserve easy access to local solicitors who they can be assured have some degree of specialism.”

Kent Accident Link was launched earlier this month after Medway firm Stephens & Son became frustrated that members of the public were more likely to approach claims management companies because they enjoyed a higher media profile. The other firms are Andrew Gardner Partnership, Boys & Maughan, Bradleys, Christopher Harris & Co, Furley Page, Gambrills, Kingsfords, Martin Tolhurst Partnership, Thomson Snell & Passmore and Warners.

The campaign will seek to distinguish the lawyers from the opposition. “We’re saying that we’re local solicitor firms; there are no middle men and no referral fees,” Shicluna says. “We wanted the public to know that there is a difference and that they don’t have to go to the claims companies.”

It is the same message from the FSC. According to Diane Rostron, a partner at Lytham-based Rostrons, the firm contacted all 60 firms offering PI advice in the region after the Blackpool Gazette ran a story about an accident victim who was left penniless after costs were taken from his damages. It was a variant of The Sun’s story of Jason, a bar worker, who was scarred for life after an accident at work involving boiling tea, which was run as part of their ‘Shames Direct’ campaign. After a two-year wait he was awarded £1,525, only to receive a cheque for £63.

Again the message is to enable the public to differentiate between the lawyers and the claims companies. Rostron says: “We make a point of saying that we’re local, we have a face and you can come in and see us. We won’t necessarily enter you into a very expensive insurance policy and we will get a significant proportion, if not all, of your damages back.”

Both groups will be running extensive advertising in the local newspapers and on the radio. FSC comprises Addies, Blackburn & Co, Blackhursts, Cooper Nimmo, Inghams, John Budd & Co, Lawsons Samuels Capaldi, Leslie Harris, Lonsdales, Palmer Hodgson & Heyes, Roland Robinsons & Fentons, Thornton & Co and WH Darbyshire & Son.

An interesting feature of the Amelans network is that member firms have to sign up to an agreement which means, win or lose, the clients do not pay a penny. Twambley explains: “It’s so much of a qualifying criteria that we’re insisting member firms actually give a solicitor’s undertaking that they won’t touch the client’s damages, because that’s one of the big problems of all the schemes.”

By contrast, the FSC does not make such a claim because, according to a Rostron spokesperson, “we don’t know how the case is going to work out, and more importantly how the law is going to work out”.

The Association of Personal Injury Lawyers (Apil) is also giving these regional initiatives its backing. In fact, the group has been talking up the merits of such arrangements for the last couple of years on its marketing courses. In particular, the group is encouraging lawyers to use membership of the College of Personal Injury Law, Apil’s training division, in such campaigns.

“They can use it to show the different levels of expertise that they have and use it as a kitemark of quality,” explains Apil chief executive Denise Kitchener. There are currently 800 Apil members at different levels of experience (litigators, fellows and senior fellows), and the group is currently running a public awareness campaign through citizens’ advice bureaux, advice centres and public libraries to raise its profile.

But what is the message that PI lawyers should be communicating to Joe Public? As far as Twambley is concerned, it should be simple and blunt: only trust an independent solicitor. “The message that the adverts will send out is: don’t go to claims management companies; don’t go to your own insurer, who has a financial interest in stitching you up; and for God’s sake don’t go to the other person’s insurer.”

But how do PI lawyers get their point across in the face of the spending might of the claims companies? For example, adverts in the back of the local paper and the Yellow Pages are not going to dint the public consciousness alongside the saturation TV advertising that the likes of Claims Direct and TAG have deployed in the past.

Jeff Zindani, the founding member of online PI service Forum Law and former Russell Jones & Walker partner, believes that regional marketing is a “limp-wristed” approach to a crisis that has beset the profession. “I’m not sure how on earth you’re going to get the cottage industry of PI lawyers together to try and compete against the claims management companies,” he says. Zindani sees his specialist online model as a response to the inroads that claims companies have made into PI work. Forum Law is joining up with a search engine and will launch in January.

Zindani clearly despairs of the ‘cottage industry’ mindset of PI solicitors. In fact, he believes solicitors have much to learn from the claims companies in terms of their efficiency, accessibility and business structures. “The business model of the claims management company is the right model, and some of them are now getting a lot more ethical,” he says.

Are members of the public likely to make an informed choice between going straight to a solicitor or opting for a claims company? “No, of course they aren’t interested,” says Zindani. “You talk to a client, and do they know who Russell Jones & Walker are or Rowley Ashworth? There’s no brand differentiation; and when they see the Claims Direct or TAG advertising they just see the big companies.”

Unsurprisingly, those lawyers investing in the marketing do not see it that way.

“The public aren’t stupid,” reckons Shicluna. “They may see some advantage as to why they can ring and get through to someone who appears to be dealing with them. But what they might not realise is that they might not be getting the level of service that they could be.”

As Twambley points out, there are real consumer issues at stake concerning clients recovering all of their damages and the freedom to choose one’s own lawyer. It might not be easy to put that across, but he says that the message is nevertheless easy: “Don’t trust the claims companies.”