Latest new claims intake data shows RTA and PL claims continuing to move towards stable levels while incoming reforms explain trend of increasing EL volumes
We return again to the MI released by Claims Portal and look at what the data for the month of September tells us about current claims trends.
In terms of monthly claims intakes in September, there were reductions in the case of RTA of 5.6%, PL of 2.9% and EL of 1.4%, but the shorter working month meant a loss of working time of 9.1%, so that measured on a daily basis there were in fact increased volumes in all 3 of those portals. EL disease intake rose 5.2% in the month but from a historic low level the previous month.
On the longer term analysis based on 12 month data, both RTA and PL showed small reductions this month of 0.3% and 0.2% respectively, but both continue to move towards more stable claims levels where over 2018 to date the average monthly decline is only 0.1% for RTA and 0.2% for PL.
On the same longer term assessment EL was an exception showing an increase of 0.4% this month and a calendar year to date average monthly increase of 0.2% effectively demonstrating a marginally increasing commitment to that type of claim among claimant operations. As with PL claims, EL claims would of course stand to be less affected by the intended changes to be brought about by the Civil Liability Bill and associated Small Claims Track reforms.
EL disease claims looked at on the same longer term 12 month data view showed a reduction of 3.7% in the month and a calendar year monthly average decrease of 2.7% to date which equates to an increasing rate of decline.
We are now midway through the 2018/19 accounting year used in CRU data. If claims continue over the 2nd half of the year at the same rate then the RTA portal total as at the end of March 2019 will reach a level 15,000 lower than in 2017/18, which would represent a decrease of 2.1%, significantly less than the reduction of 12.0% seen 12 months earlier.
Further litigation data from the MoJ is also considered showing a reduction in the number of litigated injury claims worth over £1,000 throughout the calendar year of 2017 which are in the 38-43% range. This latest data also shows that the proportion of litigated injury claims valued at under £5,000 and therefore the category due to be most closely impacted by the incoming CLB/SCT reforms would be as much as 70.7% of what is in any event a reducing number.
New RTA claims in September
We saw in September that there were 55,133 new claims into the RTA portal, that's a reduction of 5.6% from the 58,432 which entered during the previous month. September's level was the lowest for any month during the calendar year of 2018 to date and in fact was the lowest since last December.
We had seen during 2018 to date, in the exceptional months of May, July and August how the previous trend (of this year's number for any month being the lowest for that particular month since the portal was new) had not been followed.
However this month we return to that prior pattern: the entry number for September is the lowest for the month of September ever recorded. It is lower than September 2017 by a relatively small 3.1%, but less than September 2016 by 16.7% and lower than September 2015 by 24.6%.
The monthly average number of new RTA claims in the current calendar year now stands at 58,096, which is now 2.4% less than the 2017 average of 59,521. At the end of last month the gap was 1.6% so is 50% greater this month.
Comparing the first 9 months of 2018 with the same months in 2017, the current level is 3.3% below the comparative number for last year at 60,071. This is very similar to the 3.2% deficit at the end of last month.
New RTA claims in September – time weighted
There were only 20 working days in September compared to the 22 in August, so a reduction of 9.1% in working time. As this is a larger number than the 5.6% drop in claims seen over the month, it amounts to an actual increase in the number of claims per working day.
The current level is around 2,750, similar to the level in July, and while higher than in June and August, still lower than in the first half of the calendar year. The current level as seen last month is though comparable to those recorded in the second half of 2017.
This is now the 19th consecutive month that the average number of claims per working day has been less than 3,000.
New RTA claims over the longer term
Looking at longer term trends on a 12 month cumulative basis, over the period up until the end of September there had been 695,040 new claims, a reduction over the month of 0.3% from the level of 696,819 seen at the end of August. This is the 27th decrease over the last 32 months.
The curve on the graph above continues to show a relatively stable picture over the last 7 months. Over that time the average monthly decrease is only 0.1%.Over the calendar year of 2018 to date the average monthly decrease is greater at 0.3%, though this in turn is smaller than the average fall per month in 2017 which was 1.1%.
Longer term the rate of decrease has fallen: from 11.7% between September 2016 and September 2017 to 5.4% over the last 12 months.
Comparison with annual CRU and portal data
With September's data now available, we are exactly halfway through the April to March accounting year used by the DWP in their CRU data released annually. The graph above shows the annual figures up to 31 March 2018.
Over the first 6 months of 2018/19 there have been 342,676 new RTA portal claims. If the second half of the year follows the same pattern then there will be 685,352 over the full year. Last year there were 700,008 new RTA claims into the portal so we are now looking at a reduction of around 15,000 or 2.1%.
While the expected deficit has increased from 1.2% and 10,000 over the last month, it is still significantly smaller than the reduction of 12.0% seen when 2017/18 was compared to 2016/17 in terms of portal data.
The CRU RTA total for 2017/18 was 650,019, so the currently projected portal total for 2018/19 of 685,352 would be 5.4% higher.
New casualty claims in September
New PL claims
There were 4,774 new PL claims in September, a reduction of 2.9% from the level seen in August, though August had been the highest level for 6 months, and there has of course been the 9.1% reduction in working time.
This is the lowest entry number of new claims for the month of September since the casualty portals were new. The current level is 2.7% lower than in September 2017, 16.2% less than in September 2016 and 23.2% below the September 2015 level.
The monthly average of new claims for 2018 to date is now 4,851. This is 1.4% less than the average for last year of 4,917. It is also 2.9% less than the average for the first 9 months of last year which stood at 4,996.
New EL claims
September saw 3,814 new EL claims, which is a reduction of 1.4% from the level of 3,868 in August, again rather less than the drop in working hours.
This level is higher than in September 2017 by 4.6% so this is not the lowest month of September since the casualty portals had opened. The number for last month is though lower than in September 2016 by 13.4% and is also less than in September 2015 by 18.6%.
Over 2018 to date the average monthly level of new EL claims is now 3,922. This is 1.7% higher than the average for the calendar year 2017 which stood at 3,855. It is also 0.3% higher than the corresponding average for the same part of 2017 which was 3,910.
New EL disease claims
There were only 445 new EL disease claims in September, an increase of 5.2% over the record low month of August, but still the 2nd lowest single month since the casualty portals were 2 months old.
The current level is 37.1% less than in September 2017, 47.5% below September 2016 and 76.1% lower than in September 2015.
The current average new EL disease claims intake in 2018 to date is now 552. This is 27.0% less than the average for the calendar year 2017 which was 756, and is also 31.2% below the average for the same months of that year standing at 802.
New casualty claims over the longer term
As with RTA claims we can look to the 12 month cumulative data for longer term trends. At the end of September the number over that period stood at 57,693, a reduction of 0.2% from the comparative number of 57,826 at the end of August.
There have now been reductions on this form of assessment in 33 of the last 39 months as the red bars on the preceding graph demonstrate. Of the last 12 months there have been 5 monthly increases and now 7 monthly reductions so the rate of decline is clearly slowing.
The average monthly rate of decrease this calendar year to date remains at 0.2%, whereas the corresponding monthly reduction across 2017 was 0.7%.
The more historic data also shows a slowing rate of decline: 10.3% between September 2016 and September 2017 falling to 2.8% over the most recent 12 months.
Over the 12 months to the end of September, the volume of EL claims rose to 46,358, an increase of 0.4% over August's level of 46,191. This means that while there have been 24 monthly reductions out of the last 34, as with PL we have also seen 5 increases as well as 7 decreases within the last 12 months.
Over the calendar year 2018 to date, we now see a small average monthly increase of 0.2%, whereas during 2017 there was an average monthly reduction of 0.6%.
Longer term, there was a reduction of 7.9% between September 2016 and September 2017, while over the last 12 months the decrease was nominal only at 0.7%.
EL disease claims
There were 6,887 new EL disease claims over the 12 months till the end of September, a fall of 3.7% over the month where the level at the end of August stood at 7,150. This is the 33rd consecutive monthly decline.
The average monthly decrease in the year 2018 to date is now 2.7%, whereas over the calendar year of 2017 it stood at 1.4%, so it has effectively doubled in degree.
Looking back further shows too that the rate of decline has slightly decreased, from 32.2% between September 2016 and September 2017, to 27.6% over the most recent 12 months.
In September there were improved retention rates across all 4 portals as the preceding graph shows.
Over the longer term, the RTA rate remains stable at 53% as does EL at 28% and PL at 22%. EL disease rose to 5% over the month.
RTA claims – stage 3 usage and PSLA levels
In September 5,765 court packs were prepared as a necessary prior step to using stage 3 of the portal process. That was a fall of 3.9% from last month's level of 5,999, but that reduction is less than the reduction in working days between the 2 months.
This month's figure is the lowest during 2018 to date, and indeed is lower than every month in 2017 apart from December. The record level reached in July of 6,829 continues to appear an exception, and otherwise it is difficult to see any reappearance over the last 2 years of the previous trend of increasing use of stage 3.
Average PSLA in September fell back £20 or 0.7% to £2,820 from its previous level of £2,840. This is the 6th highest month to date reflecting a pattern of increasing quantum, but is still the lowest month since April of this year.
Last month, we were at a level 2.1% above late last year when the effects of what were across the board average increases of 4.8% introduced by the 14th edition of the Judicial College Guidelines began to have effect. This month, the level is only 1.4% in excess of pre-14th edition levels, 50% less.
Casualty claims – stage 3 usage and PSLA levels
Taken together across the 3 casualty portals, as the bars on the graph above show, we saw in September the lowest use of stage 3 for almost 18 months.
In the case of PL, the number fell 21.1% to 60, the lowest level since April.
With EL, the level fell 27.8% to 65, the lowest since May.
And in the case of EL disease there were none produced. This means that there has only been 1 pack in total over the last 3 months.
In the case of PL, PSLA fell in September by 0.9% to £4,341, though August's level had been the highest to date, and September is still the 3rd highest month. The current level is 1.1% higher than pre-14th edition.
With EL, PSLA was 2.0% up over the month to £4,291, but still with no identifiable effect of the 14th edition.
It rose 3.0% for EL disease to £4,121, the highest level since March. The current level is 5.7% in excess of the pre-14th edition position though sample size remains small at only 30 cases last month.
Comparative use of stages 2 and 3
We can see from the graph above a comparison between stages 2 and 3 in terms of the point at which claims have settled, in order to see whether the prior trends towards more cases settling at stage 3 are continuing.
In the case of RTA claims, 31% of claims which settled needed to use at least part of stage 3 in order to do so. The level is unchanged over the month. While the level of one-third of claims proceeding to stage 3 was reached in July it is yet to be repeated.
Proportionate use of stage 3 fell in both of the casualty portals which we also show on the preceding graph. PL fell 1% to 12% and EL by 4% to 9%, reflecting the reduced use of stage 3 in those portals which we noted above in our earlier analysis.
Litigated injury claims
We looked in the concluding part of last month's review of the portal data at data from the MoJ on the number of litigated injury claims, and this month can do so by reference to value bands within the same MoJ MI. The graph above identifies those claims worth up to £5,000 which especially in the case of RTA claims will be primarily affected by the incoming reforms, as well as claims valued at up to £15,000, up to £50,000 and also litigation valued at above that level.
As with the overall PI litigated claims data, there is a common picture of a gradually reducing level of litigation from 2009 through to a low point reached in Q2 of 2014 probably in the aftermath of the LASPO changes which had come in the previous year, then an increase before a further reduction in Q2 of 2015/Q1 of 2016, followed by relative stability to around Q1 of 2017, with another decreasing trend since.
As to the most recent reductions during the calendar year 2017 based on this more detailed MI which is available only through to Q4 of 2017:
- £1-5k claims fell by 38.9% from 181,066 in Q2 to 110,655 in Q4
- £5-15k claims fell by 42.7% from 60,364 in Q1 to 34,614 in Q4
- £15-50k claims fell by 39.5% from 15,007 in Q1 to 9,074 in Q4
- over £50k claims fell by 39.2% from 3,726 in Q1 to 2,264 in Q4
These are clearly significant reductions and would suggest a greater reluctance to issue court proceedings in the current climate where the sector is being greatly affected by the incoming reforms. While as we have seen there have seen significant variations in litigation volumes previously, it remains to be seen whether this time the number of litigated matters will rise again and if so when.
If we want to identify the degree to which current litigation is in relation to claims worth under £5,000 at which level it will at least in the case of RTA cases be more directly impacted by the CLB/SCT reforms, we can see that at 110,655 cases out of a total number of litigated injury cases worth over £1,000 which stands at 156,607, the sub-£5,000 category represents 70.7% - a substantial proportion.
For more information please contact Simon Denyer, Strategic Legal Development Consultant DD 0161 604 1551 Simon.firstname.lastname@example.org
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.