Claimant lawyers should not believe the hype that industrial deafness cases are a “cash cow” – and risk negligence actions if they do – personal injury consulting law firm Citadel Law has warned.
Managing director Lesley Graves was responding to a speech by James Dalton of the Association of British Insurers, in which he said lawyers and claims management companies were turning to industrial deafness cases because of the level of fees involved.
Ms Graves said that while industrial deafness cases look attractive because of the fees, the specialist legal skills needed to deal with them means unprepared lawyers, insurers and bankers will lose out in the end.
She said: “Anyone thinking that industrial deafness claims are easy money is sorely mistaken. Our reviews [of industrial deafness cases] have highlighted serious incidents of poor case preparation and under-settlement or failure, leading to the risk of the firms themselves facing professional negligence claims. You can’t pile ’em high and sell ’em cheap in this area of law.”
Ms Graves added that the insurance industry has a big role to play: “The ABI also needs to look within and encourage its own members to increase their own skills and numbers for industrial deafness cases, so they can work with claimant lawyers to reduce the time a claim takes, and reduce costs significantly.
“Without the requisite skill set within the insurance sector, the ABI’s concerns over rising claimant lawyers’ costs will become a harsh reality.
“Professional indemnity and ATE insurers also need to build closer relationships with law firm clients, so they can be sure they are not offering cover to law firms who don’t have the skills to cope with these cases.”
The other stakeholder that needs to be aware of this issue is those funding law firms, she said: “Banks and private equity are increasingly monitoring the PI sector and looking for reassurance that their investment is managed properly. Poorly managed NIHL cases are a risky investment, and if unchecked we will see an erosion of a profession that is supposed to focus on delivering justice to those who have a genuine need for it.”