Horwich Farrelly urges regulators to address claims farming

Horwich Farrelly has reacted to reports of record-breaking numbers of nuisance calls from claims management companies by urging regulators to take greater steps toward tackling the problem of claims farming.

In the Information Commissioner’s Office’s (ICO’s) most recent report on the issue, a 12 per cent increase in reports associated with nuisance calls and texts have been recorded, totalling 180,000 throughout the last year. The report has indicated that, among the worst culprits, accident claims firms account for more than one in seven (14 per cent) of all complaints, second only to calls relating to boilers.

Meanwhile, LV= has also found that more than 60 million of the annoying calls and texts are sent every day. The insurer has estimated that almost half (46%) are from claims management companies trying to find new personal injury claimants.

Horwich Farrelly has stated that the two pieces of research show that more needs to be done to “tackle the scourge” of fraudulent claims.

Fraud partner at Horwich Farrelly Ronan McCann said: “Many of our insurer clients are still reporting increases in the number of farmed claims they receive. Most of these claims have little substance yet add to the insurer’s operating costs and consequently the premiums charged to honest policyholders.”

He added that there was now “probably more of a case than ever before” for “concerted action and regulatory muscles to be flexed”.

“We see evidence every day that a section of society believes insurers are ‘fair commercial game’ not only for invented claims but also the massaging of claims to get that little bit more which is equally abhorrent.”

“We would urge all regulators with an interest to raise the priority they give to claims farming and use the powers at their disposal to remove the worst offenders from the market.

Mark Dugdale