The impact of reform on PI and clin neg lawyers

Dyas: Hidden, subconscious agenda

Posted by Tony Dyas, senior business developer at Litigation Futures Associate Allianz Legal Protection

With the Civil Liability Bill generating further turbulence in the legal market, ALP hosted a local roundtable with solicitors in the Bristol area to discuss the challenges and opportunities in the personal injury and clinical negligence market.

Over the course of two hours, the conversation focused on both customers and the profession, beginning with the impacts of the legal reforms.

So, what are the impacts of the legal reforms on customers?

The group was of the view that there’s a hidden, subconscious agenda which they’ve been slow to pick up on. This is the question of whether honest customers should receive compensation for minor injuries. It’s an unconscious debate in that it gets lost in all the talk about the financial impact of the reforms.

No doubt it’s going to become harder to bring low-value cases in the same way they’ve been brought in the past with full legal representation. All agreed that there will be an impact but it won’t be seen for some time – begging the question of whether it will be too late for customer groups to respond effectively.

In the longer term, what are the impacts on the legal profession?

The immediate response was de-skilling, with recruitment focused on paralegals rather than proven expertise. There will be fewer experienced personal injury and clinical negligence lawyers and a smaller talent pool to draw from in the long term.

For those paralegals entering the market, high-value cases are attractive but with so few of these around, there already seems to be a move to enter commercial law, where the rewards are greater.

This means low-value cases will become less attractive and lawyers won’t be able to run them as they won’t be cost effective. So, who will pick up this work? Unproven experts or will cases simply not be run?

A representative from Clarke Willmott summarised it well: “I didn’t enter the profession to turn down cases where compensation is rightly deserved due to such cases being uneconomical to run.”

And what about the short-term impacts?

Solicitors will become more selective about the cases that are taken on. That’s a logical next step but it might mean that some more difficult cases that solicitors’ firms would have previously taken on and won, won’t be pursued.

Also, law firms will be under more pressure to accept offers on cases. Whilst the interest of the client is fundamental, there will unconsciously be some pressure to settle cases earlier as margins become tighter.

Advertising and marketing has changed in the market – social media has grown and is now a fundamental part of promoting brands and services to customers. The spike in TV advertising has slightly reduced over the past 12 months and this channel is often seen to have a negative impact on the industry as it promotes a compensation culture.

Liked or not, however, TV advertising has huge reach and solicitors would find it difficult to compete with the largest in the market through other marketing channels.

Turning to customer perception, discussion focused on whether customers are aware of their rights and how they access legal services

Consensus was that people are becoming more aware of their legal rights, although there are generational differences. Millennials access and use information far quicker and are generally more aware of their rights. This makes them more inclined to ‘claim’ than older generations.

All customers can now easily shop around, so it’s not uncommon for them to approach two or three firms before making a decision. This makes a law firm’s online customer journey vital for establishing confidence with a customer on first impression.

And whilst there also seems to be customer demand for law firms to embrace technology with online transactions supporting growth, a face-to-face experience is still valued and needed.

There is also an expectation from customers around fixed-price deals and price publication so they can easily compare costs. With price a more highly considered factor than brand and proven expertise, it’s likely this customer expectation is only set to increase.

And lastly, where does mediation sit in all this?

Generally, all law firms attending said they were not seeing a growing trend for mediation, because defendant law firms have little appetite for it. However, there has been a slight increase in NHS Resolution promoting mediation.

Our panel concluded that solicitors will always settle cases by negotiation but they readily accept it takes both parties to have that view for cases to settle. They’re open minded to change but don’t think that any form of compulsory meditation is likely to be successful in the near future.


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