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Latest pointers from Claims Portal data for July now available as news of further disruptive factors is awaited

Claims Portal has released its claims data for the month of July and we look at it here for the latest trends affecting claims handling.

Summary

The signs of a disrupted market remain clear as we await the publication of the Civil Liability Bill which is planned to have a significant impact in this area as part of the government's plans for reform of whiplash and other small claims track cases. Longer term trends of new claims volumes into all of the portals continue to remain negative.

In July there were reduced volumes of new claims into the RTA portal and into all 3 casualty portals when compared to the data for June, though when adjustment is made for the length of the working month we see net monthly volume increases for RTA and PL, the two largest portals.

The 14th edition of the Judicial College Guidelines is due this time next month and is expected to have an inflationary effect on damages for PSLA. To date the 13th edition has contributed to PSLA increases of 9.3% for RTA, 13.0% for PL and 8.3% for EL since its publication.

New RTA claims in July

01

In the month of July there were 59,339 new claims submitted to the RTA portal. That's a small decrease of 2.1% over the volume seen in June. Numbers have been relatively similar over each of the last 3 months: in each case they have been within 700 of the 60,000 level.

The trend of lower new claims levels than seen in previous years continues. The number of new claims in July 2017 was the lowest for that month since July 2010 when the RTA portal had just opened.

This essentially repeats the trend seen throughout the first 6 months of 2017. Over the first 4 months of the year between January and April we saw that the number of new RTA claims entering the portal was the lowest for that particular month since that portal had opened, the only limited exception being March 2017 where the level had been exceeded by one previous year.

Since then, that is from May through to July, we have seen levels which have been the lowest to date for those specific months of year, with the sole exception of new claims volumes seen in the initial months of the RTA portal as it gained maturity which it took 6 months or so to do. That adage is true for July as already noted. It was also applicable for the months of May and June as well, with the exception of those same two months in 2013 which were artificially low in the immediate post-LASPO claims peak.

The RTA new claims volumes for July 2017 were lower than July 2016 by 9.7%, lower than in July 2015 by 26.4%, and lower again than in July 2014 by 19.3%.

New RTA claims in July – time weighted

02

There were 21 working days in July as opposed to 22 in June, a decrease of 4.5%. As the actual fall in volumes between the months was only 2.1%, this leaves us in the position where in terms of new claims per working day we saw a month-on-month increase of 2.6% as between June and July as depicted on the graph above.

Last month when we looked at the data for June we saw that for the first time over the period spanned by the graph we had reached the position where the number of new RTA claims per working day had been below 3,000 for 4 consecutive months. We now have a 5th month below that level.

Again, when we looked at this data a month ago, we were able to say that during 2017 from January onwards, there had been a continuous pattern of 5 consecutive monthly decreases. That run has come to an end with July showing the net increase of 2.6% highlighted above.

New RTA claims over the longer term

03

Looking at the graph above to check longer term trends on a 12 month cumulative basis, we see a further monthly fall, so that there have now been decreases in 21 of the last 23 months.

This month the fall was from an annual level of 761,652 to 755,258, or 0.8%. This is a smaller drop than that seen across the earlier months of the calendar year 2017 which averaged 1.2%.

Over the last 12 months since July 2016, the fall has been 9.9%, whereas over the preceding 12 months going back to May 2015, the decrease had been 4.6%, from which it seems that the longer term rate of decrease is increasing.

The previous low point on the graph above was seen in April 2014 when the immediate post-LASPO effects had passed and the level then seen was 771,709. The current level is 2.1% below April 2014.

Comparison with annual RTA data

04

The graph above shows the annual RTA portal new claims numbers up until the end of March each year, and now 4 months into 2017/18 we can see where the latest pointers are as to where the figure for the current year may end up.

After the first 4 months of 2016/17, the monthly average now stands at 58,001, whereas after the first 4 months of last year the monthly average then stood at 68,192. In the full year 2016/17, we saw 797,067 new claims at a monthly average across the year of 66,422.

If new RTA claims continue being submitted at the current rate, then over the full 12 months of 2017/18 the annual total would be 696,012. This is marginally higher than the predicted level seen last month but still below 700,000, a level we have not been below since the portal's inaugural year where the data was collected over only 11 months.

If the 2017/18 annual RTA portal total does end up near 696,012, then this will be below the 2016/17 level by around 100,000 or 12.7%.

New casualty claims in July

05

All 3 casualty portals show a month-on-month decreasing intake of new claims in July when compared to June, with the larger falls arising for EL and EL disease.

Looking back to the month of July over the preceding 3 years, when compared to the data from all 3 portals in each of those 3 years the current level of new claims is lower.

New PL claims

July saw 4,942 new PL claims, a small decrease of 1.3% from the June level. When the shorter working month of July is taken into account, this becomes a net increase of 3.5% over the month.

We saw with RTA claims that new claims volumes have now been at similar levels for the past 3 months, as in each of those months they had been within 700 of the 60,000 mark. The same position of similar new claims volumes exists with PL claims: in each of the last 3 months the level has been within 75 of 5,000 per month.

Looking back at the months of July over the preceding 3 years, the current number is lower than in July 2016 by 6.1%, is lower than in July 2015 by 27.8%, and lower again than in July 2014 by 32.0%.

New EL claims

There were 3,564 new claims to the EL portal in July, a fall of 10.7% from the June level. When account is taken of the shorter working month, the net decrease is smaller at 6.1%.

Comparing to the same month in the previous 3 years, July 2017 was 12.2% lower than in July 2016, 29.6% lower than in July 2015 and 23.6% lower than in July 2014.

New EL disease claims

July saw 746 new EL disease claims registered to the portal, a drop of 17.8% from June. Taking account of the fewer working days in July this equates to a net fall of 14.0%.

Looking back over 3 years to previous Julys in this portal, July 2017 was 9.4% lower than in July 2016, 58.1% less than in July 2015, and 56.8% lower than in July 2014. 

New casualty claims over the longer term

06

Longer term trends continue to be negative on this 12 month cumulative form of assessment, though there are specific variations as to the extent of the decreases across the 3 types of claim entering the casualty portals.

PL claims

Over the 12 months up to and including July 2017, there were 60,551 new PL claims, a decrease of 0.5% over the level seen a month ago. Over the previous months of this calendar year we had seen average monthly falls of 0.9%, so the extent of this month's decrease is reduced. There have though been falls in 24 of the last 25 months.

Over the 12 month period going back to July 2016, the cumulative figure has fallen 9.9%, whereas it fell 12.4% between July 2015 and July 2016, so that the rate of decrease has slowed.

EL claims

Over the same prior 12 month period up to July, there were 47,917 new EL claims, a month-on-month decrease of 1.8%. This is a larger monthly fall as the average drop during the months of the calendar year 2017 up until June stood at 0.5%.

There have now been monthly falls in 15 out of the last 19 months. We have now also seen decreases in 3 of the last 5 months, 2 of which showed rises in cumulative volumes. However the extent of the falls has been more significant than the increases across those 5 months, with an overall fall over the last 5 months of 3.2%.

Between July 2016 and July 2017 there was a decrease in cumulative volumes of 5.8%. Going back a further 12 months between July 2015 and July 2016 there had been a decrease of 6.9%, so that again there has been a slowing of the rate of decline.

EL disease claims

In the 12 months up to July there were 9,834 new EL disease claims to the portal, which is a decrease of 0.8% from the position seen a month previous. The average monthly decrease during the calendar year of 2017 stood at 1.7% so this month's adjustment is around half that level.

This is the 19th consecutive monthly fall, and is only the second time after last month that the number stands in 4 rather than 5 figures.

There was a fall on this measurement of 37.7% between July 2016 and July 2017, as opposed to a decrease of 28.4% between July 2015 and July 2016, so the rate of reduction has increased.

Retention rates

07

The month of July saw monthly improved retention rates for RTA and for PL, but reductions for the EL portal and for the more volatile EL disease portal.

08

Longer term trends continue to be upwards in the case of PL and EL, though the same trend for EL disease may have gone into reverse before reaching 10%.

The trend for RTA continues its longer term stability at marginally above 50%.

Both retention rates graphs count cases concluding at stage 3 as retained with the portal process.

RTA claims – stage 3 usage and PSLA levels

09

Stage 3

In July 6,208 RTA claims proceeded to preparation of the court pack, the 5th highest month to date. This was though a monthly drop of 5.1% from June (though it will be recalled there were 4.5% fewer working days last month) which in turn was the 2nd highest month so far.

The overall trend remains upwards, though the bars on the graph above show increased levels of volatility since last November, during which time there have been 4 monthly decreases out of the 8 months being considered.

PSLA quantum levels

The lines on the preceding graph show PSLA levels and in July there was a month-on-month increase of 1.3%, up to £2,805. Apart from the unusual level reached in October 2016 this is the highest figure to date and it reverses a short-lived pattern of 2 consecutive monthly falls.

Over the last 12 months the PSLA level has increased 4.9%, whereas over the preceding 12 months it had risen 3.4%.

The 14th edition of the Judicial College Guidelines is due to be published in the second week of September, 2 years after the last edition which impacted on PSLA levels from November 2015 onwards. Since then we have seen an increase in RTA PSLA of 9.3%.

Casualty claims – stage 3 usage and PSLA levels

10

Stage 3

A mixed picture across the 3 casualty portals as can be seen from the bars on the graph above.

In the case of PL, 87 claims had court packs prepared, the highest ever number and an increase of 20.8% over the previous month.

With EL however, only 47 were prepared, a reduction of 47.8% from June, though June in turn had been easily the highest month ever.

Just the 1 EL disease case needed a court pack in July, the same number as in June, which leaves only 12 having been prepared in this calendar year to date.

PSLA quantum levels

The general picture across the casualty portals is of increasing PSLA levels, as it is with RTA claims.

With PL, the PSLA average increased 4.2% to £4,305, this being the second consecutive month where the highest level to date was reached.

The increase over the last 12 months now stands at 6.6%, whereas the increase over the preceding 12 months had been 6.3%. Since November 2015 and the impact of the 13th edition of the JCG the rise has been 13.0%.

As to EL, PSLA levels in July averaged £4,170, a monthly fall of 1.2%, but still the 4th highest monthly level so far.

Over the last 12 months there has been an increase of 4.9%; over the previous 12 months the increase stood at 12.5%; since November 2015 it has been 8.3%.

In the case of EL disease, we have also seen increasing PSLA in July. There was a month-on-month increase of 19.1%, up to £4,191, the highest level for 2 years.

There has been an increase of EL disease PSLA of 11.6% over the last 12 months; there was a decrease of 7.8% over the preceding 12 months; the increase between the current level and that from the JCG 13th edition with effect from November 2015 is 4.9%.

Comparative use of stages 2 and 3

11

The increasing use of stage 3 continues and is clear from the graph above. The current trend line for RTA and for PL is upwards: RTA approaching 30% and PL at around 13%. EL has been as high as 12% but is currently under 10%.

Claims still in the portal

RTA claims

12

 

The number of claims which have entered but not yet left the portal continues to rise, and now stands at nearly £1.2m. Some of these will be expected to progress, but many will not. The steps announced by Claims Portal designed to reduce this number have yet to have a discernible effect.

Casualty claims

13

 

The number of retained casualty claims has started to increase more rapidly over the last 6 months and now exceeds 55,000. This is 20 times fewer than for RTA, but the same trend as witnessed with RTA can expect to be repeated.

 

 

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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