With the help of LV= Senior Motor Underwriter Michelle Smith, we look into the claims farming situation and get advice on how to stay safe.
Have you ever been called by an unknown number, only for someone to say you've been in an accident? Usually you'd hang up immediately – but if you have been in an accident, how do you tell if the call is from someone genuine?
You may want to make a claim on someone's car insurance, but if you do it with the help of a claims farmer, it could end up costing you money. If the claim doesn't go through, the claimant solicitor could drop the case once they realise they have no chance of winning, making you, the claimant, foot the bill.
With help from LV= expert Michelle Smith, we get to the bottom of claims farming so that you don't get caught out by cold callers.
Claims farming is when a person or company encourages someone else to make a claim – usually a personal injury claim after a car accident or a claim against mis-sold PPI (payment protection insurance). A trend that's recently emerged is companies encouraging holidaymakers to claim compensation for illness from their travel insurance when they return home.
Some claims farming companies make cold calls to people, asking if they can talk to them about an accident they've had in their car. They will then encourage them to make a claim for personal injury. The claims farmer will pass the information over to a lawyer, who may pay the claims farmer a fee if they take on the case.
Claims farmers may not always know if you've been in an accident - they often target phone numbers at random. Various techniques are used to find people who may have been involved in an accident but not suffered any personal injury, including using social media. In other cases, information can be obtained illegally from sources such as insurance companies, or even car rental companies.
Not all cold calls are illegal - if you've agreed to receive marketing calls the company may be within their rights to call you. However, some companies may overstep the mark. The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) made it illegal for 'authorised persons', including insurance companies and claims management companies, to receive a fee for referring a personal injury case to a solicitor.
It is also illegal to make a fraudulent claim on your insurance.
If you haven't been in an accident, hang up.
Otherwise, ask questions to make sure that the caller is from a genuine insurer that could be involved in your case. Insurers will often contact innocent third parties if one of their customers has been in an accident, and will know far more about the incident than claims farmers.
Don't answer any questions before they satisfactorily answer yours – many companies will quote the Data Protection Act and say they don't have all the details, using it as an excuse for you to tell them. Read the Information Commissioners Website for more information on nuisance calls.
Firstly, make sure everyone involved is safe, stay calm and, if no one is hurt, exchange details with the other driver. If someone has been injured call the emergency services. Try to avoid discussing who was to blame, even if you think it's obvious. It may help your insurer if you can take any photographs or get CCTV footage from the scene. If there are witnesses to the accident, ask for their details so they can be contacted by your insurers - it may help with your claim if somebody else saw the accident happen.