A new system of benchmarking is to be introduced from October 2001 to help control legal costs in fast and multi-track cases, delegates at the Insurance 2000 conference heard this week.

Guest speaker Master John O'Hare, a taxing master and costs judge, said that costs recoverable from opposing parties which have to be assessed by the court can be “slow, cumbersome and expensive”.

He added: “In cases covered by the benchmark scheme, the court will award the benchmark sum unless persuaded to award a larger or smaller sum or unless persuaded to order a detailed assessment.”

Delegates also heard from Arthur Lightbody, vice president, head of casualty claims, at AIG Europe and Helen Merfield, rehabilitation manger at AIG Medical and Rehabilitation about the effect structured rehabilitation has on claims management.

Merfield commented: “Studies have shown that 75% of patients off work for one year, and 90% of patients who have been off work for more than two years do not return to productive employment. But how many claims are settled within a year?”

They said AIG had seen how separating the medical and insurance issues and providing access to early rehabilitation and return to work can lead to an improved claim handling process. This was in addition to reduced litigation, hidden and direct costs for employees and reduced time period for loss of earning for the injured claimant.

Other speakers included Brian Meigh of Winchester White, who talked about how companies have to develop a new mindset to survive in the era of ecommerce and Bob Lark, general manager of Ford & Sons, who looked at why product replacement rather than cash settlement would cut costs and add value for insurers.

Chris Wheal, editor of Insurance Times also spoke about the way forward for insurers and brokers and said that to retain the customers of today, the industry had to begin offering a more innovative service for the ever more demanding customer of tomorrow.