Latest Personal Injury Market Report – More Uncertainty for the Sector

21 Sep 2020

Personal Injury Market Trends Report 2020

The planned small claims reforms have been hanging over the market for months and changes to the timing of these reforms continues to create uncertainty in the sector. These reforms have now been put back again to April 2021 and, if this date is finally the one, then there will be more pressure on a market that is already seeing a decrease in road traffic accident (RTA) claims, the largest claims sector by volume, and most other claims as well. The long-term decline in RTA claims has been exacerbated in the short term by the coronavirus pandemic with a drop in vehicle journeys during the lockdown.

All this means that, even if claim numbers start to increase in the last few months of 2020, it will still be a difficult year for the personal injury (PI) market. Delays in the completion of claims during the lockdown also create warning signals for firms that need a claim to be completed to generate the revenue and we can expect to see more firm closures as the money dries up.

This feels like a watershed moment for the market: the small claims changes mean that many firms will only take on a small number of RTA cases because the majority of these cases will be under the £5,000 small claims limit and become uneconomical. Plus, this is unlikely to only impact on the smaller players. Up to now, many of the purchases of PI firms, teams and caseloads have been larger players buying smaller portfolios but some of the larger players have a high volume of business in the RTA sector.   Mergers between some of the larger players are likely while other larger players will have to restructure their PI practices and teams.

Value growth in the market has been between 2.5% and 2.8% in recent years, i.e. 2017 and 2018, but annual value growth improved marginally in 2019 when it reached an estimated 3.1%. However, it is unlikely that this growth will be sustained in 2020 or 2021. COVID-19 has had an impact in 2020 with lockdown reducing the number of RTA claims and workplace injury claims, while market value growth in 2021 will be adversely impacted by the new small claims regulations.  Some work on claims backlogs in 2021 will help revenues but there is unlikely to be any notable value growth.

IRN Research’s annual opinion survey of personal injury practitioners shows that providers are less confident than a year ago: 18% of firms surveyed experienced reduced workloads in the last year, increasing from just 8% in the 2019 survey and 9% in 2018. The percentage experiencing an increase in volumes dropped to just 25% from 42% a year earlier.

Despite the turbulence in the sector, slightly over 4 out of 10 practitioners are expecting their PI workloads to increase in the next 12 months but this is less than in the previous year.

This report looks at the market structure, recent developments and market drivers, the key players, the market size and trends and the future.  The report costing £200 can be purchased directly from IRN Research. For more details see http://www.irn-research.com/market-research-reports/

 

CONTENTS

EXECUTIVE SUMMARY. 5

Introduction. 5

Market characteristics. 5

Latest regulatory changes pushed back to 2021. 5

RTAs and industrial accidents declining but claims against the NHS increase. 6

Improved market growth in 2019 but unlikely to be sustained. 6

PI practitioners are less optimistic than a year ago. 7

Introduction. 7

Definition. 8

Abbreviations. 9

MARKET STRUCTURE. 10

The main types of personal injury work. 10

Four main market participants. 10

The number of solicitors and legal companies. 11

The number of claims management companies in decline. 12

MARKET DEVELOPMENTS AND DRIVERS. 13

Overview.. 13

Increase in small claims limit and FRCs pushed back again to April 2021. 14

Medical examinations for whiplash claims. 15

No agreement on fixed recoverable costs for clinical negligence cases. 16

Proposed new damages-based agreements regulations in new review.. 16

New protocol for PI claims during COVID-19. 17

Review of the Criminal Injuries Compensation Scheme. 18

THE KEY PLAYERS. 19

Overview.. 19

Mergers and acquisitions. 20

Key players. 21

Admiral Law Ltd. 21

Bott & Co Solicitors Ltd. 21

DLG Legal Services Ltd. 22

Express Solicitors Ltd. 22

First4Lawyers. 22

Fletchers Solicitors Ltd. 23

Neil Hudgell Ltd. 23

InjuryLawyers4u. 23

Irwin Mitchell LLP. 24

Leigh Day. 24

Lyons Davidson Ltd. 24

Minster Law Ltd/BHL (UK) Holdings. 25

NAHL Group/National Accident Helpline Ltd. 25

Redde/NewLaw Solicitors. 26

Simpson Millar LLP. 27

Slater and Gordon Lawyers. 27

Stewarts Law LLP. 28

Thompsons Solicitors LLP. 28

Thorneycroft Solicitors Limited. 28

Winn Solicitors Ltd. 29

MARKET SIZE AND TRENDS. 29

The number of RTAs declines year-on-year. 29

Workplace injuries are declining. 30

The number of serious workplace injuries is also in decline. 31

Just over 31,000 cases related to criminal injuries received, over 35,000 resolved. 33

A market valued at almost £4 billion. 34

The volume of cases registered with the CRU declines. 34

Over £300m recovered. 36

Number of personal injury claims heard in court decreases for the second year. 36

Expenditure on NHS clinical negligence claims decreases in 2019/20. 37

Claims Portal figures. 40

THE FUTURE. 41

More uncertainty ahead for the market. 41

A changing landscape for the PI market. 42

Market forecasts. 42

Personal injury practitioner survey 43

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