….the process gave insurers an unfair advantage. They discovered the Coalition entered into a secret deal with insurers before deciding on the amount of compensation payable, the details of which they refuse to publish.
The Independent newspaper (et al) have published evidence from the Justice Select Committee which suggests a government compensation scheme supposed to help the families of people killed by exposure to asbestos was too heavily influenced by the insurance lobby.
Background to the Ministry of Justice Review
of Mesothelioma Claims:
The UK Government recently introduced major reforms in England & Wales to the funding of personal injury claims contained within the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) and the Conditional Fee Agreements Order 2013. New rules on conditional fee agreements (CFA’s) came into force in April 2013. Those who enter into a CFA will have to pay their solicitor’s success fee and any after-the-event (ATE) premium from their damages.
CAA revealed in our News on 24 April 2012, that the BBC had reported that those who suffer from mesothelioma were to be exempted pending a Ministry of Justice Review of Mesothelioma Claims. The Government’s review concluded that these funding arrangements should now apply to mesothelioma claims as they do to other forms of civil litigation. It appears that, as part of the process, an agreement between the government and insurance industry, regarding the Diffuse Mesothelioma Payment Scheme, funded by employers’ liability insurers, was reached.
The Independent newspaper:
The Justice Select Committee investigated how the Government had decided on a new compensation programme paid for by insurance companies and found the process gave insurers an unfair advantage. They discovered the Coalition entered into a secret deal with insurers before deciding on the amount of compensation payable, the details of which they refuse to publish. (‘Secret deal meant mesothelioma compensation scheme favoured insurers’: Independent online 1/8/14).
The Actuary (the magazine of the actuarial profession):
As part of this process, an outline agreement between the government and insurance firms about the Diffuse Mesothelioma Payment Scheme, funded by employers’ liability insurers, was reached…. According to the ‘heads of agreement’, the Association of British Insurers and the government agreed a process that included a number of action points, including a government commitment to review the applicability of provisions of LASPO. (‘MPs criticise government over mesothelioma review). The Actuary online 1/8/14.
In response to the Justice Select Committee report a Ministry of Justice spokesman is quoted as saying:
Mesothelioma is an awful condition which can destroy lives in a frighteningly short amount of time and we want to help sufferers and their families. We are considering the best way to get claims settled fairly and quickly. We will consider the report’s recommendations and respond in due course.
CAA will be monitoring the UK Government’s response with interest.
- Editor’s note: The Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) and the Conditional Fee Agreements Order 2013 apply in England & Wales. Funding of personal injury claims in Scotland is vastly different to the provisions now in place in England & Wales. Click here for more information.