Personal Injury firms need to change their ways to survive

by PaulReflect on December 12, 2013

The Jackson Reforms 2013 are so-called for Lord Justice Jackson who was tasked with preparing a report in which he reviewed the costs of civil litigation and assessed how they affected access to justice.

These changes came into force in April 2013, and have seen major changes to the way in which litigation cases, such as personal injury are heard and determined.

The changes

Jackson proposed a number of changes and for the majority these have come into force. In chief, he determined that referral fees should be abolished, that conditional fee agreements should change, that contingency fees should change, that damages should be more highly awarded but that the amount solicitors can charge for successful claims should be capped at 25% of the received amount, and that the amount for certain injuries should be capped to prevent excessive claims being sought.

The reaction

Prior to the introduction of the Jackson reforms 2013, there was some concern as to how personal injury firms like Blackwater Law would handle the new regulations.

Of course, the main aim of the reforms was to ensure that whilst those firms, such as Blackwater Law who upheld the morality of PI law, would succeed whilst the less reputable firms who have damaged the reputation of the industry would be unable to operate.

However, as the changes have taken place, many of the leading personal injury firms have suggested that even the more reputable firms need to amend their policy and actions in order to survive post-Jackson.

Key among these is David Marshall, the Managing Partner of Anthony Gold. Mr Marshall told firms they must “get big, get niche or get out” if they are to survive the changes. He suggested that the firms who continued with business as usual could lose up to 40% of their income leaving them without profits.

In addition, whilst many firms have reported little changes in their profits, accounts or business, Mr Marshall suggested that many of these may be relying on cases they took on prior to the Jackson reforms 2013, and prior to any of the other warnings issued by personal injury news forums.

Get big

Key among Mr Marshall’s directions is for firms to “get big”. He believes that those firms who merge with claims management companies and create a commoditised business could see a 400% increase in their volume of work. He also suggests that these firms could save on large wages bills by employing less qualified staff and more information technology.

Get niche

His second suggestion was that firms create themselves a niche market. They could do this, he claims, either by way of a boutique firm or a back to basics local firm. In his boutique model, the firm would specialise in certain areas such as military claims or abuse cases, abandoning other work in favour. In comparison, a back to basics business model would see the firm focusing on local areas and personal service.

Mr Marshall seems under no illusions about the effect that either of these ideas, or the overall notion of the Jackson Reforms 2013 will have on the Personal Injury industry: “We are going to be earning a hell of a lot less per case,” Marshall said. “The whole system is designed to ensure that.”



Sales & Marketing Director at Reflect Digital
Sales & Marketing Director at Reflect Digital, a leading online marketing agency specialising in the legal sector.

Previous post:

Next post: