COVID-19 claims farming, risk level: high
In mid-March, as the UK was reacting to the pandemic and implementing social distancing measures and advising you to work from home, claims farmers had their minds on one thing - coronavirus claims.
We have monitored and analysed open source information to identify how quickly professional enablers have reacted to capitalise on the pandemic and capture any resulting claims.
Analysis of limited company incorporation data between February and March from Companies House show 45 newly incorporated limited companies that contain the words 'corona' or 'COVID' as part of their company name. These appear to range from help and assistance companies, to cleaning/PPE companies, and of particular interest, what appear to be claims management companies.
Newly incorporated limited companies that contain the words 'corona' or 'COVID':
Of these 45 companies, a significant number were incorporated on 18 March, and over 11% of these incorporated companies have names which suggest a link to claims management activity, including:
• COVID-19 Virus Compensation Limited
• Coronavirus Claims Limited
• Coronavirus Compensation Limited
• Coronavirus Legal Solutions Limited
• Coronavirus Refunds Limited
The award for the quickest CMC incorporation goes to Coronavirus Claims Limited and Coronavirus Compensation Limited, both incorporated on 13 March, one day after the UK risk level was raised from moderate to high.
At the time of writing, Google trends shows search term interest in coronavirus compensation for the UK peaked on 16 March. We do, however, expect there to be a lag in COVID-19 related personal injury claims, which will take various forms as new areas of duty, breach and loss are explored. This may include disease claims against employers and the NHS. These issues have already been explored by Kennedys and will continue to do so on our COVID-19 focus area.
Google trends search term interest in coronavirus compensation for the UK:
Kennedys IQ are tracking key COVID-19 references in Claims Portal data. We are already seeing coronavirus-referenced excuses for claims behaviours in RTA claims. As early as February, coronavirus related reasons have been cited for not seeking any initial medical attention. For example:
Accident date: 26 February 2020 | Claim date: 27 February 2020
The Claimant has been unable to get through to GP to get an appointment for an assessment due to increase in calls due to coronavirus.
Accident date: 3 April 2020 | Claim date: 6 April 2020
The claimant has also suffered with a headache but has not sought medical attention due to COVID-19.
It is easy to see COVID-19 becoming the ubiquitous excuse of the dishonest, who recognise a new and universally accepted get out of jail free card:
- Why didn’t you see a doctor? Covid.
- Why was there a delay in responding? Covid.
- Why did it take so long to repair the vehicle? Covid.
- What are these extra cleaning charges? Covid.
We are yet to see a significant move into social media advertising targeted at the public in relation to coronavirus-related claims, but the early signs are there. We have identified a number of law firms updating their websites to include specific coronavirus compensation sections, focusing on challenging insurers whose policies are not reacting to claims.
In third-party claims, firms are also advertising in respect of employers' liability from contracting COVID-19 due to the failure in supplying personal protective equipment, even though there is currently a worldwide shortage.
We have not yet identified any employers' liability claims specifically in relation to coronavirus, however we continue to monitor new claims and trends and provide insights to our clients via our Kennedys IQ platform tool, Portal Manager.
We fully expect claims farming to continue its evolution into more types of claims. COVID-19 presents a new frontier for claims and claim behaviours. Following declining claim numbers in areas such as motor, EL and PL personal injury, COVID-19 opens new opportunities for CMCs.
We have previously explored the diversification of claims farming from the personal injury space into other areas in our claims farming blog mini-series, which is perhaps a useful place to start when thinking about what is coming next around the corner.
Claims farming series
Claims Farming part 2: modus operandi
Claims Farming part 3: you've been farmed, and funded
The Kennedys IQ team share their latest news, as well as their most recent thoughts and insights about the issues facing the insurance, legal and claims sector.Go to blog
As developments unfold, Kennedys experts across the world advise on what the COVID-19 pandemic means for you and your business.Go to focus area