CRU claims data – the end of “compensation culture”?

On 9 May, the Department for Work and Pensions (DWP) released annual statistics on the number of personal injury claims registered with the Compensation Recovery Unit (CRU). The data reveals that for the year April 2023 to March 2024, there were, 44,547 employers’ liability (EL), 58,933 public liability (PL) and 348,806 motor claims notified to the Unit.

In context

A direct comparison with the previous year (2022/2023), shows that EL claims have risen by 2%, whilst PL claims have increased by 10%. Of greater significance is the comparison with the pre-pandemic baseline of 2019/2020, where EL notifications stood at 79,027 and PL at 72,587 respectively.
Since 2019/2020, EL claims have reduced by 44% and PL claims by 19%.

The reduction is even starker when placed into context with the figures for 2013/2014, which saw the highest peak in EL and PL claims registered – at 105,000 and 104,000 respectively. This year’s figures (2023/2024) show reductions of 58% for EL and 43% for PL from the highest volumes recorded in 2013/2014.

Motor

The number of motor personal injury claims registered fell again this year from 367,806 the previous year – a fall of just over 5%. Claims in this sector have fallen steadily year on year from the peak seen in 2011/2012 of 828,489. This year’s total represents a reduction of almost half a million claims (479,683) or in percentage terms – 57% from the peak year.

Commentary

Motor

The much vaunted “whiplash reforms”, which included raising the Small Claims Track limit to £5,000 and the introduction of a tariff-based system of damages, have served to accelerate a trend which was heading downwards before the reforms came into play in May 2021.

EL and PL 

The DWP data which encompasses all personal injury claims registered, sits alongside the recent data release of 2024 quarter 1 figures by the Online Injury Claims Portal Company, which saw stagnant levels of Fast Track EL claims and reducing levels of PL claims compared to the previous year – with reductions of 33% and 27% respectively compared to the pre-covid baseline year of 2019/2020.

Given the consistency of new claim notifications since all pandemic restrictions were lifted, this year’s figures are likely to be viewed by statisticians as representing the “new normal”.

Additionally, the data and comparisons with 2013/2014 undermine the views expressed by some media organisations that the UK remains in the midst of a so called “compensation culture”. The reasons behind the reductions in EL and PL claim volumes are multifactorial and include:

• The fall in claimant solicitor firms and CMC’s operating in the personal injury space - numbers of claimant law firms have reduced to just under 300 compared to over 2,000 seen at the start of civil justice reforms in 1999.
• The concentration of Claims Management Companies and claimant law firms on “easier/softer targets” – examples include damages for data breaches and claims against diesel vehicle manufacturers, rather than injury claims or NIHL.
• Increased working from home and remote working.
• A renewed focus by employers on safety standards and generally a “safer society”.
• A rise in the number of economically inactive people of working age by reason of either poor mental health or long term medical conditions.

The broader issue of whether the UK has a “compensation culture” is discussed in greater detail in this article “CRU claims data – stagnant levels rule out post-covid bounce back”.