Last week I read a couple of interesting articles in Insurance Post regarding the proposed fee caps being introduced by the Financial Conduct Authority (FCA) on Claims Management Companies (CMCs). Insurers are wary of an influx of CMC-related claims following the proposed whiplash reforms, so this comes with little surprise.
Whilst the whiplash and small claims track reforms are being introduced to effectively enable injured parties to bring their own claims, some claimants are going to need help in what can be a daunting process, as most wouldn’t have had to make an personal injury claim before. Claimants need to be able to trust the system and many will seek greater assurance and advice to help them. So naturally CMCs will look to fill this ‘void’ in the market, which in turn could be an unintended consequence of the reforms.
But is the increased control of CMCs, whether that’s by further regulation or controlling the level of fees they can take from the claimants damages, really the answer? Or is this even the right question?