Managing claims

Why this risk matters

  • Solicitors and law firms play a critical role in delivering access to justice for people who have been harmed. They must act in the best interests of each client, but they also have duties to the court, the rule of law, and the proper administration of justice.
  • When several people have been harmed and have a valid claim in law, many firms use claims handling processes to meet this demand. This can include employing non-legally qualified staff, working with introducers and using the latest technology. These are all reasonable when managed appropriately. Solicitors and firms must competently manage and progress all claims and meet the high standards expected of them.


  • We regulate more than 10,400 firms, of which 7% specialise in personal injury services, which we categorise as more than 50% of their annual turnover. 17% of the firms that are an alternative business structure (ABS) specialise in personal injury work, which is more than other areas of work. This proportion has increased by 6% in the last 18 months. We believe that personal injury firms may find it easier to become an ABS due to their existing relationships with insurers and claims management companies.
  • The top five reasons for our investigations about personal injury services are:
    • alleged insurance fraud (24%)
    • client care and competence (19%)
    • prohibited referral fees which might be disguised in marketing costs (9%)
    • misleading court (8%)
    • cold calling (7%).
  • There are also concerns about some solicitors and firms bringing personal injury claims without their clients’ permission and not training or supervising their staff adequately.
  • Misconduct relating to personal injury services is more likely to be referred to the Solicitors Disciplinary Tribunal (SDT) than other work.
  • Some firms are failing to meet high professional standards when bringing claims for mis-sold payment protection insurance (PPI) and other financial products. They are:
    • not investigating that there is a valid claim
    • handling all cases the same rather than tailoring their approach to each client or claim
    • making claims without knowledge of the policy holder
    • submitting false claims in the hope of a settlement without further investigation by the defendant
    • charging unreasonable costs.

What can firms do

  • Solicitors and firms must make sure that in following their client’s instructions they do not compromise their duty to the court and the proper administration of justice. They should also comply with any relevant legislation applicable to the claim, such as the:
    • referral fee ban in personal injury cases (Legal Aid Punishment of Offenders Act 2012)
    • interim fee cap for PPI claims of 20% of the claimant’s damages, if the claim is settled without court proceedings (Financial Guidance and Claims Act 2018).
  • Solicitors should read our warning notices to keep up-to-date with common risk factors when bringing claims.
  • The extent to which firms should verify their clients’ cases is risk-specific. For example, there seems to be a serious risk that many holiday sickness claims are not genuine. We realise it can be difficult to verify these claims, but solicitors must engage with case law and properly assess all evidence before submitting claims.
  • Our updated report, Balancing duties in litigation can help solicitors recognise situations where their duties conflict.

What are we doing

  • Our Payment Protection Insurance: Thematic review looked at firms conducting PPI claims, before the interim fee cap, to find out more about the work and raise awareness of good and poor practice. We found that 16 out of the 20 firms we visited were routinely charging fees of more than 25%, with some charging as much as 50% of the total claimed for clients.
  • We are investigating multiple allegations about the conduct of firms involved in PPI and personal injury, including holiday sickness claims.
  • We have updated our warning to solicitors and firms about the conduct of some holiday sickness claims. We are concerned that some are being submitted without proper analysis of the evidence or an understanding of the legal position. The Legal Choices website suggests questions that people with genuine holiday sickness claims can ask a solicitor.
  • We have investigated and acted against firms over potentially improper links with claims management companies and payment for referrals of claims.
  • Where solicitors do not comply with their professional obligations, we will investigate and act as appropriate. Solicitors who act dishonestly or without integrity can expect us to take disciplinary action, and refer them to the SDT.