Claims Standards Council announces new applicants as NU fuels row

Ten new companies have applied to join the Claims Standards Council (CSC) following its endorsement by the Lord Chancellor, Lord Falconer.

First Class Legal, Entitlement Ltd, Accident Advice Helpline, Wingate Evans, Real Health, HCML, Frenkel Topping, Legal Advice Bureau, Accident Injury Claims and Litigation Protection are all applying for CSC membership, a spokesman said.

The CSC has also accused Norwich Union (NU) of sabotaging its efforts to regulate the claims management sector after the insurer criticised the idea of self-regulation in The Times.

In a letter to Aviva chief executive Richard Harvey, CSC chief executive Anthony Burns-Howell said self-regulation of the claims management sector would become "an impossible task if someone like Mr Clayden [NU director of technical claims Dominic Clayden] has decided that the CSC has no role to play in helping to regulate claims managers".

The letter continued: "I am alarmed by Mr Clayden's remarks, which seem to indicate that he, and therefore Norwich Union, is encouraging compensation culture."

Burns-Howell wrote to Aviva asking for clarification on the insurer's position.

Clayden said NU would not co-operate with the CSC until the claims management industry had shown it was capable of a self-regulation.

AXA has also refused to join the CSC.

A spokesman for the CSC said Clayden's comments resulted in several companies who were in discussions to join to withdraw from the application process.

He added that several companies who had previously withdrawn from the CSC were now re-engaging, following support from the industry.

NU said it would be responding privately to the letter from Burns-Howell this week.

But a spokesman for the ABI supported Clayden's position. He said that Clayden had echoed the concerns of the ABI over the ability of the claims management sector to self-regulate.

The spokesman said that it was a "wait and see" situation at present as the "the jury was out" as to whether formal regulation would have to be introduced.

In response to Clayden's comments, the Department for Constitutional Affairs said: "Norwich Union's comments may have been taken out of context as we understand they do support the goal of proper regulation however achieved."