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While latest portal data shows increasing volumes in May, news of likely future trends must await developments from Westminster as to claims process reform

As the political turmoil continues at Westminster with junior ministerial posts including at the Ministry of Justice still being announced, Claims Portal have released their data for the month of May.

Summary

In May there were increasing numbers of claims into the RTA portal and into all of the casualty portals when compared to the previous month, but this is unsurprising where April saw particularly low volumes. The additional working time available in May when compared to April is also a factor.

Longer term trends of new claims continue to be downwards for RTA and EL disease, though there are further signs of numbers stabilising in EL and this may now be affecting PL in addition.

Future volumes will be affected by the intentions of the new Conservative minority government in relation to whiplash and small claims track reform, or something less. While we have a new Justice Secretary in David Lidington, and now know that Dominic Raab will be returning to the MoJ as a minister, the identity of the other MoJ ministers and their respective roles is yet to become known.

The Queens Speech which was due to have taken place on Monday could have made matters clearer, but the major overnight fire in west London seems to have delayed the finalisation of talks between the government and the DUP, which seems likely in turn to delay the events planned for Monday.

Whether the previous government's intentions which were set out in Part 5 of the Prisons and Courts Bill will return in their previous form remain to be seen. We need to know what the realistic expectations of further reform are before being able to identify whether the most significant effects of those reforms will continue to be felt in the case of RTA claims.

New RTA claims in May

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There were 60,664 new claims to the RTA portal in May, which was an increase over April of 16.4%. But caution should be exercised before seeing that as a significant increase.

We need to factor into account the number of working days per month in our comparison with the previous month. In April, a month affected by the Easter bank holidays, there were 18 working days, while in May the number increased to 21 despite the usual 2 bank holidays. That is an additional 16.6% of working hours, almost identical to the rise in volumes, as the height of the 2 bars to the right of the following graph shows. So the increase could be fully explained on that basis.

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The other aspect to have in mind when seeing this month's increase over April is that the number of new claims in April was low, in fact the lowest April on record.

With the exception of May 2013 where the number was artificially low as the month in question followed immediately after the LASPO-induced peak of claims, this is the lowest May for new claims since the RTA portal opened.

May 2017 was lower than the same month in 2016 by 7.5%, lower than in May 2015 by 12.0% and lower than May 2014 by 8.3%.

This is following a recent trend where the number for March 2017 was the lowest seen in that month of the year since March 2011 when this portal was in its infancy, while April's number was the lowest for any April since the portal opened.

The new RTA claims number can therefore be seen to be following that trend of marginally lower volumes over the last 3 months. Indeed it is almost precisely following last month's level when the number of working days is taken into account.

Looking at the previous graph, it can be seen that this is the first time since the post-LASPO period in late 2013 that we have seen 3 consecutive months where the number of CNFs per working day has been below 3,000.

DfT data

The number of vehicle miles travelled has continued to increase at a stable rate since 2013 as is shown in black lines on graphs above and below. The new claims numbers suggests however that it may not be having any significant effect on RTA volumes however.

The number of accidents causing injury is shown in a red line on the graph above. Its relatively stable level reflects the longer term stability in volumes which we look at below in relation with annual data.

New RTA claims assessed over longer term

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Looking at longer term trends by reference to cumulative numbers over 12 months, the number has fallen this month by 0.6% to 771,961.

This is less than the large fall seen last month of 2.4%, but not out of the ordinary compared with other decreases seen this year of 0.3% and 1.3%.

There is an ongoing downward trend on this measurement, now for 19 of the last 21 months.

Over the last 12 months this measurement has seen a fall in the cumulative volumes by 9.6%, when compared to a fall of 1.2% over the preceding 12 months, though for the first 3 months of those preceding 12 months there had not in fact been monthly decreases.

The post-LASPO low point seen on the graph above in April 2014 was at a level of 771,709. The current level of 771,961 is almost identical. Any further decrease which takes place beyond the current level which must be expected on current trends will take cumulative volumes below where they stood in April 2014.

Comparison with annual data

The annual portal data over each financial year up to the end of March looked like the graph below and the 2016/17 total of 797,067 was equivalent to a monthly average of 66,422.

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We are 2 months into 2017/18 and the current average is around 10,000 lower at 56,390. While there is plenty of time yet for new trends to emerge, if the current trend continued this would result in an annual total for 2017/18 of 676,680, a reduction of 15% from last year's level. We would be surprised if that were the eventual result as it is early days.

New casualty claims in May

As with RTA, in the case of each of the 3 casualty portals there were large increases in the number of new claims entering in May when compared to the preceding month, though as also was the case with RTA claims, care should be taken before seeing the increases as significant. One of the factors to have in mind is the same 16.6% increase in the number of working days in May when compared to April.

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New PL claims

In May there were 5,146 new PL claims, an increase of 23.5% over April and so an increase in real terms taking account of additional working hours available of around 7%.

When we compare this level to previous months of May, we see that there was no real variance to May 2016 as the numbers are almost identical, but the current level is lower than that seen in May 2015 by 5.3% and lower than May 2014 by 12.1%.

New EL claims

There were 4,145 new EL claims in May, an increase of 22.7% over April, and so a real terms increase of around 6% from what we saw in April, similar to the position with PL claims.

But when we look back in time to previous months of May the position with EL claims is that their current level bears a closer comparison with past years.

The current level of EL claims is marginally greater than in May 2016 showing a rise of 0.4%, is lower than in May 2015 by 2.5%, but higher than May 2014 by 12.9%.

New EL disease claims

May saw 828 new claims, an increase of 16.8% over the previous month, and almost identical to the amount of additional working time available.

Looking back to previous Mays, the current level is lower throughout. It is 3.8% lower than May 2016, 55.2% under that seen in May 2015 and 39.1% under the level which existed in May 2014.

New casualty claims assessed over longer term

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Over this longer term type of measurement there are further signs of stability being reached in volumes of new EL claims and perhaps also in PL, and even the rate of decrease in EL disease claims has slowed.

PL claims

As measured over the preceding 12 months the number now stands at 61,633, a minimal decrease of only 0.004% from where the level stood a month ago. But as it still counts as a fall, we have now seen decreases in 22 of the last 23 months. Is the rate of decrease going to slow further in the following months?

Compared to the position 12 months ago, on this form of assessment there has been a drop of 11.4% over that period. Over the preceding 12 months the decrease had been 9.6%.

EL claims

The 12 month cumulative figure over the last 12 months for EL claims stands at 48,680, a small increase of 0.04% over the month. This is the second increase in the last 3 months. There have nevertheless been falls in 13 of the last 17 months.

Looking back 12 months ago, over that time we have seen a decrease of 7.1% on this measurement, while there had been a decrease of 2.0% over the preceding 12 months although for the early part of that period numbers had been increasing.

EL disease claims

We see a smaller decrease than usual this month, the 12 month cumulative number now being 10,035, a fall of only 0.3%. But it is still nevertheless the 17th consecutive monthly fall.

Comparing the current position to that which we saw 12 months ago, we have seen a decrease of 43.3% over that time, compared to a drop of 17.1% over the previous 12 months.

Retention rates

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Last month saw improved retention rates in the RTA, PL and EL portals, but a falling one in EL disease.

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Longer term trends on this further graph continue to showing improving rates in all casualty portals, particularly so in the case of EL disease which is now returning to 10%, a level last reached 18 months ago. But even then only 1 in 10 disease claims starting in that portal conclude within it.

Both retention rate graphs include within the definition of retained claims those cases which make use of stage 3.

RTA stage 3 usage and quantum levels

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Stage 3

The month of May saw 6,371 cases progressing to the preparation of the court pack needed as part of the triggering of stage 3. This was an increase of 7.8% over the previous month and the third highest ever.

While the pattern of increasing usage of stage 3 is not uniform, an average of the last 3 months would be the highest 3 monthly period to date.

PSLA quantum levels

Last month the average quantum fell £7 to £2,789. This is the first decrease following 5 consecutive monthly increases.

The level has increased 5.7% over where it stood 12 months ago, which level was a further 2.4% over the level a further 12 months back.

As we start to approach the time when we can expect the release of the 14th edition of the Judicial College Guidelines, we currently stand 8.6% higher than the level seen in November 2015 immediately after publication of the 13th edition.

Casualty stage 3 usage and quantum levels

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Stage 3

As the bars on the graph above demonstrate, there was a much reduced number of casualty claims progressing to stage 3 last month. Increased usage of stage 3 has returned in May.

In the case of PL, 77 claims went through to stage 3 in May, a monthly increase of 75%. This is jointly the third highest monthly total.

For EL, 63 matters went to stage 3, a monthly rise of 16.7%, jointly the 4th highest to date.

With EL disease, 3 cases went to stage 3 which was 3 more than the previous month.

PSLA quantum levels

The PL monthly average was £4,022, a monthly fall of £249 which followed on from 4 consecutive increases. The increase over 12 months is 2.2% while over the preceding 12 months it had been 14.1%. The rise since the JCG 13th edition is 5.6%.

With EL the monthly average in May was £4,108, a rise of £24. The current level is 7.3% over where it stood 12 months ago while that level in turn was 10.7% above what we saw a further 12 months back. Since the 13th edition of the JCG the increase is 6.7%.

In the case of EL disease in May the average was £3,208, a decrease of £98. Flouting the norms seen in the other 3 portals and for its own particular reasons associated with the way that portal is used, there is a fall over 12 months of 18.6% which followed another drop of 1.4% over the preceding 12 months. The current level is 19.7% under where it stood in November 2015 just after the JCG 13th edition came out.

Comparative use of stage 2 and 3

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The graph above shows the month on month comparison between settlements at stage 2 and stage 3. Last month over 30% of settling RTA claims concluded at stage 3. This month the figure has fallen to marginally below that level but the fall-back is expected to be temporary.

Proportionate use of stage 3 increased for PL to just above 10% and in the case of EL to just under that level.

Settled claims

RTA claims

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In the case of RTA claims we saw 15,949 claims settling at stage 2, an increase over April of 18.6%. However, April's settlement figure at 13,452 was the lowest since the portal was in its infancy. This will be caused by a reducing intake into the portal coupled with a higher proportion progressing to stage 3.

Casualty claims

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641 PL claims settled at stage 2 in May, a rise of 12.9% from April. 627 EL claims did so, a smaller increase of 1.6%. Taking the two together there was a sizeable increase over last month as shown on the graph above, though it should be recognised that April was the 2ndlowest month since these portals were becoming established. The same factors as seen in evidence in relation to the number of settlements with RTA claims will be having some impact albeit to a lesser extent in the case of casualty claims.

Contact

For more information please contact Simon Denyer, Partner on +44 (0)161 604 1551 or email simon.denyer@dwf.co.uk

By Simon Denyer

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This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.

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