The fifth quarterly release of data relating to the operation of the OIC portal has just occurred. So what does it tell us?
OIC Q5 data release: process is improving but ‘the backlog’ and friction continues to rise
Total submissions
351,409 claims have been submitted to the OIC process during the 16 months since launch.
71,191 claims were submitted via the OIC portal in this latest quarter. That mirrors the submission rate for the preceding quarters and so it can now be said, with some confidence, that the number of submissions has levelled off to about 71,000 per quarter, or about 5,500 per week. Circa 285,000 can be expected in any 12 month period.
Representation
Around 91% of all OIC portal users continue to be represented. There is a slight move away from law firms (74% down from 76%) towards ABSs, but not much news otherwise.
Liability outcomes
‘Litigants in person’ continue to meet with more admissions that those who are represented, consistently receiving a full or partial admission in around 93% of cases.
Those represented are more regularly meeting with denials now. There is about a 1% decrease in admissions (full or part) per quarter to those represented, with only 80.4% receiving such a response in the three months from July to September 2022.
It is unclear what this is down to, save perhaps better and more efficient investigation processes within insurers and greater confidence in, and understanding of, the system.
Injury type
Another continuing trend is the move away from ‘tariff only’ injuries. 34.5% of all claims made in the first quarter were for whiplash and/or minor psychological damage. That has decreased by around one percentage point per quarter and dropped below 30% for the first time in this latest quarter, hitting 29.2%.
There has been a commensurate increase in ‘mixed injury’ cases, guidance in relation to the valuation of which remains awaited, meaning more friction, uncertainty and delay.
Uplift
There is little change to the number of those seeking uplift in the tariff award due to exceptional circumstances, injury or both, with the percentage of all claimants seeking such an enhancement broadly static at around 24% over the last three quarters.
Those unrepresented seek uplift more than those represented, and increasingly so (43.3% of those unrepresented sought enhancement in this latest quarter, up from 38% and 41% in quarters three and four respectively) but the numbers are small and the trend should cause no concern.
Average damages
This has remained broadly level since quarter four, with those unrepresented tending, on average, to receive more for tariff and non-tariff injuries but a little less for ‘uplift’.
Throughput
Throughput continues to be weak but is improving. Two quarters ago (December 2021 to March 2022) a figure amounting to just 28% of claims entering the system in that quarter (95,266) left the system either through settlement or for some other reason. That improved to 35% in Q4 and further increased to 43% in this most recent quarter, but we remain a long way off parity.
Moreover, we are an enormous way off eating into the backlog of claims in the system. The data released does not detail where claims are up to after the point of ‘liability decision’ and before either settlement or the claim leaving the system for some other reason (including going to court). So we don’t know whether insurers are receiving medical reports.
Settlement percentage relative to claims added to the system is increasing month on month however, which would suggest that medical reports are beginning to feed through. Across the last three quarters, settlements, relative to the numbers of claims entering the system, have been 17%, 27% and then 31% most recently.
As stated previously, to prevent an ever-increasing backlog of claims in the system the number of settlements, withdrawals (by claimants), removals (by compensators) or cases litigated needs to be equal to, and then greater than, the number of claims going into the system.
Settlement time
Worryingly, this has increased from 139 days in Q3, through 175 days in Q4 to 208 days in Q5. That likely reflects the difficulty involved in negotiation now that the first tranche of mixed injury award first instance decisions have been published.
Conclusion
The system is well and truly up and running now. We are at a plateaued level of input and the ‘liability decision’ stage can be said to be a success. Insurers report few problems with being able to respond in the time and to the extent permitted.
The big problem seems to be the continued lack of settlements. It seems medical reports are simply not getting to insurers in the numbers expected. Why that is, is not clear. Conjecture is interesting but only time will reveal the truth. Claims might never be pursued post-admission, reflecting what happened to some extent when the MoJ Portal launched. Insurers will remember having thousands of ‘post-Stage 1 MoJ claims’ on their systems which, in many cases, only really concluded with limitation.
Assuming claims will be pursued in the end, it is either the case that those representing claimants are slow in moving claims towards settlement or are ‘waiting’, for whatever reason. One school of thought is that claimants, or their solicitors, are now minded to hold on to medical evidence and sit out the prognosis periods to see whether symptoms remain and/or develop in other ways. If this is correct, the reforms will not have achieved all that they set out to do.
In the short term, insurers cannot be sure whether they will see these claims, what they will cost to conclude if they do and so what the true costs of providing motor insurance are. Premium prices are therefore unlikely to be capable of being reduced any time soon.
For further information on the Official Injury Claim data and the learnings you can take from it, contact our insurance lawyers.