The care conundrum

Care costs and claims

In catastrophic injury claims, future care has for some time, almost without exception, been the most substantive head of loss when pleaded. We now regularly see annual care “packages” claimed in excess of £1 million. Fortunately, settlements in the non-clinical negligence arena are achieved at lesser sums – but for how much longer?

Records from the DWP show the total number of injury claims is falling, particularly for motor related injury, which from 2018 to 2024 dropped by more than half (667,000 in 2018 to 328,637 in 2024). Although welcome news, reflective of health and safety awareness and reforms as well as the impact of Covid, the severity and value of the injury claims being made are increasing, and sharply.

Statistics produced for the Discount Rate Review of 2024 showed that in all claims above £250k, 32% of the claim value, on average, was for care. On claims above £2.5 million but below £5 million care represented 47% claim value; above £5 million it was 53%.

The cost of personal injury claims. both in terms of damages as well as costs, is increasing alarmingly. The National Audit Office reported clinical negligence settlements rose from £1.1billion in 2006-7 to £3.6bn in 2024-25. This arises from real world economic pressure such as wage inflation (the ABI suggests the proportion of damages linked to earnings is in the range 69% to 81%) and discrete factors such as the Judicial College Guidelines increasing general damages by circa 30% since 2022.

Care claims are consequently rising, both in frequency and value; and tax and insurance premium payers will be impacted.

Unresolved issues

William Norris KC, in an article he published as long ago as 2006 by entitled “The Interface between the Public and Private Provision of Care and Accommodation Services”, for the Clinical Negligence and Serious Injury Committee of the Civil Justice Council, wrote:

“…judiciary, lawyers and litigants alike are entitled to be frustrated at the expense and complexity which attaches to investigation of (care & care funding) issues on a case-by-case basis” and described this as the “single most corrosive and complex issue in contemporary personal injury litigation”.

Despite the passage of 20 years and although the arguments may have shifted, this concern still holds true.

Victims of a compensatable serious injury, along with their lawyers, will claim for care on a private basis rather than via the NHS, especially in clinical negligence matters. The Court of Appeal in Peters v East Midlands SHA 2009 [EWCA Civ 145] held the claimant had a right to elect whether the defendant, NHS or local authority should be responsible for the costs of future care, provided there was no double recovery.

There is however no equivalent provision regarding double recovery in connection with care on a private basis and the availability of local authority care.

The issue of double recovery for care is therefore still fraught. Firstly, will a claimant actually seek private care or indeed even dismantle an established private care regime, once they have their damages, choosing instead to resort to free NHS or local authority provision? So concerned is the government regarding this that in July 2025 they instructed David Lock KC to help review clinical negligence claims, their spiralling costs and double recovery regarding care claims. However, the government confirmed in April 2026 in its response to the Public Accounts Committee’s report on the costs of clinical negligence that it “has no current plans to publish a separate report of David Lock KC’s work.” Instead, the Department of Health and Social Care (DHSC) aims to write to the PAC explaining its operational plan to tackle clinical negligence, including key milestones for achieving reductions in claim costs and volumes, by Autumn 2026. Publication of the DHSC plan is awaited.

Secondly, in R (on the application of CGT (by his Litigation Friend SGT) v West Sussex County Council, [2026] EWHC a defendant local authority's decision to refuse to fund the claimant's care needs was held to be unlawful. The defendant argued the claimant's care needs should be met from the claimant's personal injury trust. He had been awarded £2.6 million in respect of future care costs.

The court rejected this argument finding the funds in trust were wholly disregarded for the purposes of assessing eligibility for local authority care. A similar finding was made in Tinsley (by his litigation friend and property and affairs deputy) v Manchester City Council (Local Government Association intervening).

Looking ahead

There is also the overarching spiralling cost of care claims. From the 14 August 2026, Guernsey and Alderney introduced a split discount rate allowing -0.75% for damages subject to the cost of carers or nurses, -0.5% for lost earnings and costs of professionals and registered healthcare professionals but excluding carers and nurses, and +1% for all other damages.

Should this split multiplier be introduced into England and Wales, replacing our current rate of +0.5%, putting aside the increase in legal costs it would generate in satellite arguments, the cost of future care would very alarmingly increase further still.

The Guernsey and Alderney decision is no doubt a direct reflection of carers’ pay. Data from 2025 suggests agency care rates are rising by a staggering 11% on prior years. Annual wage inflation for carers is thought to be between 0.8% & 1.3% above the Consumer Price Index due to increased demand for these services because of the ageing population and supply-side constraints due to perception of the undervalue of this work, Brexit and immigration reforms. Unison has warned that proposed immigration reforms could deepen social care staff shortages, with around 96,000 vacancies already in the sector.

There are also concerns that “partisan” care experts being instructed by claimants to maximise damages. Fortunately, and rightly, this has come under judicial scrutiny and received adverse comment.

Potential solutions

There are no easy solutions to the rising cost of care claims, but that is not an abandonment of hope.

Although separate topics in their own right, issues that could be looked at and / or are already being considered include:

1. evaluating legislation and whether the double recovery / “paying twice” model remains sustainable or if reform is required (especially in clinical negligence claims) to reflect modern healthcare delivery;

2. with a considerable number of claims (especially in clinical negligence) settling without litigation, a review of alternative resolution strategies to prevent cases entering expensive litigation in the first place may be fruitful;

3. use of single joint and / or court approved care experts (the writer has not come across a single joint care expert in catastrophic injury claims for care);

4. absent use of single joint experts, joint interviews by the parties of the care experts;

5. more focus on consideration and use of specific aids and technology that actually reduce care rather than simply add to the cost of it;

6. use of cheaper directly employed carers rather than expensive care agencies;

7. revisiting the Judicial “Costs of Care in PersonaI Injury Claims: Best Practice Guidance”; and

8. extending the power of public authorities / public funders to recover outlay from insurers if they have made provision for care instead of the tortfeasor, for example, by establishing a system similar to that in France where recovery is enforced by the state health insurance agency.

Matters though are unlikely to improve and unless action is taken the value of care claims will only continue to rise.