Is there really a UK compensation culture?

Britain is in the middle of a compensation culture epidemic if you were to believe some of the headlines, but just exactly what is a compensation culture and how much of a problem, if any, is there?

2017/18 saw the lowest number of personal injury claims started in over a decade and at 853,615 claims this means that around 1 in every 100 people in the UK made a personal injury compensation claim last year. The number of road traffic accident related claims fell by 16% compared to the previous year. There were the equivalent to 2 claims for every 100 vehicles on the UK’s roads and were also at their lowest in over a decade.

These are figures deemed too high by the government.

Compare this to PPI where a staggering 12 million claims have been submitted. What’s more, the Financial Conduct Authority have spent £42 million on an advertising campaign to actively encourage more people to make a compensation claim. So according to the government it is OK to claim compensation from a bank for mis-sold PPI.

However, this isn’t the only area where we are actively encouraged to claim compensation for inconvenience. ‘Delay Repay’ is the catchy name for compensation claims introduced if your train journey was delayed by more than 30 minutes and depending on the length of the delay, you could claim up to 100% of your ticket back. Equally, if you fly into or out of an EU airport and your flight is delayed by 2 hours or more, then you can claim between £110 and £530 in compensation.

These schemes are both backed by regulatory bodies, be it the UK government or EU regulations and there have been successive plans designed to encourage people to actively make claims and make the claims process as easy as possible. In the case of ‘Delay Repay’ the government introduced new reforms to issue compensation for any journey that is delayed by 15 minutes or more.

None of us like being late for things, but a late flight or train causes inconvenience in most cases as opposed to suffering. Road traffic accidents that cause injury lead to suffering, trauma and psychological issues that can last years. Despite this, the Ministry of Justice feels it is better to reduce the compensation available for these accident victims, whilst they pour money into advertising campaigns encouraging us to sue our banks, airlines and train operators. However, for some reason insurance companies that make billions from us every year, are gaining more and more protection whilst they devalue the insurance product they sell.

Under new proposals from the government, the amount of compensation you can currently claim for a road traffic accident is set to fall by up to £1,850 and in some cases they are proposing an 87% reduction in the amount of compensation you can claim. If the pain and suffering from whiplash lasts between 3 and 6 months you will be entitled to £470 in compensation. Yet if you were on a flight from New York to London that was delayed 4 hours you can claim £530. It hardly seems fair that you can get £60 more compensation for the inconvenience of a 4 hour flight delay, compared to the pain and suffering from an injury that lasts 6 months.

So is there a compensation culture in the UK? Falling number of claims in the personal injury sector suggests we are not a rampant litigious culture, but if there is any compensation culture it is one driven by the government telling us to claim against our banks, train companies and plane operators.