ACSO Says CMCs are Quitting The PI Claims Sector

New figures from the Financial Conduct Authority (FCA), seen by the Association of Consumer Support Organisations (ACSO), show that the total number of authorised claims management companies (CMCs) has fallen by around 80 per cent from its high point of 3,213 in March 20111 to just 546 now.

Of those, 48 per cent (262), provide advice, investigation and representation, while the remaining 52 per cent (284) are lead generators only.

Matthew Maxwell Scott, executive director of ACSO, said that of the CMCs providing advice, only 30 firms cover personal injury. In 2011, the combined number of personal injury advice and lead-generation CMCs reached a high of 2,553. At the point when the FCA took over CMC regulation from the previous Claims Management Regulator in 2019, there were 1,238 firms in operation, meaning a fall of 56 per cent in just four years.

He said: “CMCs are essentially being consigned to history, at least where personal injury is concerned. Only a handful of companies remain in the market, and Official Injury Claim data show only 0.3 per cent of claimants using the portal appoint CMCs. The surviving CMCs are now largely focussed on financial or other claims.

“Ministers will hail this as a victory, although we should be worried about the continuing reduction in organisations across the sector – CMCs, law firms and others – who support people when making a claim, because it is having increasing implications for access to justice and consumer choice.”

Mr Maxwell Scott said the other lesson from the latest numbers is that alarmist fears expressed from some in the insurance industry before the launch of the Official Injury Claim (OIC) portal that it would become a ‘CMC charter’ “Have proved to be about as wide of the mark as it’s possible to be.”

He said: “Prior to the launch of the OIC, some predicted CMCs would overrun the new portal with claims and drive up fraud. Instead, a combination of the whiplash reforms and more robust regulation from the FCA have consigned much of the CMC sector – and the nonsensical idea of a ‘CMC Charter’ – to history.”