Recommendation 7

HM Government Accepted in Part

MoJ agrees that more work needs to be undertaken to better understand the flow of claims through the OIC process. Identifying unresolved cases: Context is an important consideration when looking at the issue of unresolved claims. As of 31 September, around 385,000 claims that were started on the system since launch remained unresolved. However, for a variety of reasons, not all of these are claims actively seeking settlement and this can distort settlement rate figures and timeliness. Whilst the majority of claims proceed through OIC towards settlement, there are an increasing number of claims sitting on the system where no positive action to move them forward has been taken for some time and could, therefore, be considered as dormant. The reasons that these claims become dormant can vary. Some have valid reasons, such as the claimant wishing to “wait out” their prognosis period before continuing their claim, but other claims seem likely to have been abandoned. Many claims were also stalled to await the outcome of the Hassam v Rabot Court of Appeal case14 and OIC data does show there was an acceleration in settlements after this judgment was handed down. However, there is also a significant tranche of claims which have stalled for other reasons. These include claims which have received a denial of liability and which the claimant has chosen not to pursue any further. Such claims need to be closed on the OIC system by the user (either the unrepresented claimant or the professional representative). If they are not closed, they remain in the OIC service and are currently counted as an active claim. Since launch, liability has been denied in 54,399 cases, and 936 claims have exited citing liability denial as the reason. Some of the significant remainder will have chosen to go to court, but a number of them are likely to be dormant or abandoned. Claims progression and settlements: Timely progression of claims is of great importance to ensure access to justice and is therefore something we are currently investigating in detail. MoJ has been working with MIB, CPL, MedCo and the senior judiciary to better understand claim progression, timeliness and dormancy across these different systems. 159,888 claims have now settled since the launch of the service. There is, however, an additional cohort of claims which have settled but where the claimant or their representatives have not yet confirmed the claim is complete. These are referred to as ‘open’ settlements and there are currently 20,658 of these (1,140 unrepresented and 19,518 represented) still being counted as live on the service. Claims continue to progress and settle in OIC. Unrepresented claimants are settling their claims quickly; whilst the overall average settlement time is 270 days, the average time for unrepresented claimants to settle a claim is around 167 days, compared to 327 days for represented claimants. OIC data also continues to demonstrate that unrepresented claimants are settling their claims for similar, if not higher amounts, to represented claimants. For example, the average settlement amounts for represented and unrepresented claimants are £731 and £738 for whiplash, and £952 and £981 for other injury types. Despite moving through the process far more speedily than represented claimants, therefore, the data shows that unrepresented claimants are not suffering any negative access to justice issues in respect of settlements. Lifecycle analysis: As noted above, the MoJ are currently reviewing and comparing data on the overall lifecycle of a claim. Initial consideration of OIC data has shown that the most obvious discrepancy between the unrepresented and represented claim journeys is in the period between obtaining a liability decision and the insurer making a first offer to the claimant. The average times taken to progress through four of the five key stages of the process are broadly similar for represented and unrepresented claimants but there is a notable difference between the liability decision to first offer stage. The average time taken to complete this stage is 217 days for represented claimants and 74 days for unrepresented claimants. No technical issues with the service have been identified by MIB which might be causing this discrepancy and consideration is being given as to what else could be at the root of this difference. We therefore welcome the Committee’s recommendation that “there is an analysis of all stages of the claims lifecycle, including those aspects which defendants are responsible for progressing, those which claimants are responsible for progressing, and those where improvements to the OIC portal itself could raise performance”. Next steps: We have also considered how claim dormancy might be affecting the volume/ settlement data and how this can be improved to provide greater clarity in this area. We have worked with MIB, who have developed additional data views that provide information on how long a claim has been si