I read with interest the Letter of the Week about solicitors' costs(28 November, Insurance Times).

Part of the clue as to the thinking behind the submission is in the first paragraph; namely, the insurance industry raises motor premiums and `the claims industry' has its collar felt as the culprit.

I have yet to see any evidence that provides any (reliable) analysis as to the amount of the annual increase in premiums arising from increases in the cost of claims. There are a very large number of other factors at play in the fixing of year on year premiums.

The anecdote quoted is outrageous in context and, I have no doubt, is factually correct. However, liability insurers are old enough and big enough to look after themselves. In a case such as that quoted, the remedy is not to write a hand-wringing letter, but to refuse to deal with the claims and get them before the court, where the alleged chicanery will be outed. Generalisations rarely lead to moving a debate forwards.

As to solicitors' costs, there is plenty of scope for finding sums that look to be excessive and that, on occasion, probably are excessive. There is also ample scope for solicitors pointing to insurers who refuse to deal with, or delay, settlement of proper claims.

The insurance industry should be entering into dialogue with solicitors as to how to create an environment where the majority of claims/costs that are reasonable are agreed without fuss or delay; other claims by definition can be fought hard.

Predictable costs may, at least in part, take this debate out of all of our hands.

Tim Gorman
Gorman Hamilton Solicitors

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