Queensland is fertile ground for growing scourge of car insurance claim farming

THOUSANDS of us are being targeted by a growing scourge triggered by insurance companies, and every single Queensland motorist will pay the price for it, writes Steven Wardill.

LAST week my mobile phone rang from a Sydney number and I knew immediately that answering the call had been an error.

First came that all-too-familiar delay followed by a noisy echo reverberating through the phone line of dozens of people talking in a room.

Another day, another cold call.

Immediately I began mentally cataloguing ways of getting off the phone as quickly and politely (or not so politely) as possible.

This call, however, was different.

There was no pitch about “saving money on your electricity bill?” or “cutting the cost of insurance”.

Instead the cold caller, who did not give her name, asked “have you been in an accident lately?”

She said she was from the Australian Injury Helpline.

When was the accident? Who was at fault? Do you have a lawyer?

It just so happened I’d recently had my car fixed after it came off second best in a tussle with a raised garden bed in my front yard.

It was a simple insurance job.

When I told the caller there had been a small incident, she immediately said she was getting a “senior” and put me on hold.

A bloke then came on the phone and when I asked him where he was from he said the Compensation Group, which was part of the Department of Insurance.

Never heard of it, I said.

It’s in Sydney, he informed me.

Then he quickly moved to the pointy end of the call by asking “You got injured after the accident?”

As soon as I said no, he hung up.

This is, as it is known in the industry, “claim farming”.

For the past three years, the Motor Accident Insurance Commission has tracked an increase in claim frequency while road trauma numbers have declined.

It involves syndicates of international cold-calling companies that farm accident victims for potential compensation claims and then on-sell their cases to firms of “no win, no fee” lawyers.

But how did they know about my minor ding?

There was no police involvement or hospital visit, no post on social media or any media for that matter.

Just a call to my insurance company and then a local panel beater. So how did they get my name and number? And how did they know there had been an accident?

Coincidence? I think not.

Thousands of Queenslanders are receiving these calls.

While there’s an argument putting people in contact with legal aid is a victimless transaction, it’s not so simple.

Authorities fear the scourge of claim farming is leading to a rush of dodgy compensation claims.

Every motorist in Queensland will pay a price for this because it is putting pressure on the state’s compulsory third-party scheme.

That’s what has occurred in NSW where fraud is estimated to be adding $75 to the annual cost of CTP coverage for every vehicle.

Considering there are 5.6 million registered vehicles in NSW, that’s scamming on an industrial scale.

The NSW Government moved to stamp out claim farming a couple of years ago by introducing defined benefits for minor motoring injuries.

It has ruined the business model of the clandestine industry.

Unsurprisingly, since that occurred the cold callers have looked north towards Queensland’s more fertile compensation scheme.

Already the figures reveal a spike in claims.

For the past three years, the Motor Accident Insurance Commission has tracked an increase in claim frequency while road trauma numbers have declined.

This increase is coming from minor injury claims, mostly nose-to-tail incidents in southeast Queensland, and many of the victims are being represented by big NSW law firms.

Why?

Well, while Queensland lawyers can only take half of any speculative compensation payout under the Legal Profession Act, the same does not apply to interstate firms.

Combined with no defined benefit scheme, there’s a healthy margin to be had by lawyers.

The Palaszczuk Government has been aware this problem.

In correspondence, Queensland’s Insurance Commissioner Neil Singleton has warned the claim farmers are falsely presenting themselves as officials from the Motor Accident Insurance Commission or other government agencies.

“Left unchecked, a rise in claim frequency ultimately flows through to upward pressure on premiums, which impacts the broader Queensland motoring community,” he wrote.

And in a report for MAIC drafted in January 2017, which has been obtained by The Courier-Mail, respected QC Richard Douglas said it remained a mystery how these underground groups were gaining personal information and the issue may require a Royal Commission.

Douglas was adamant the Government needed to act.

“The Gordian knot can only be cut by a legislative regime, which at the back end obviates or diminishes the motivation for legal practitioners to deal with the claim farmer,” he wrote.

He recommended expanding the 50/50 rule to interstate lawyers operating in Queensland, a specific offence against legal firms touting or paying for touting, and handing the MAIC new investigative powers.

Former treasurer Curtis Pitt in early 2017 insisted he was concerned about privacy breaches by claim farmers but so far the Palaszczuk Government has done nothing.

The cost of this inertia won’t just be more annoying cold calls.

It will drive up CTP premiums and hit the hip pocket of every motorist in this state.

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SHADOW OVER CULTURE AT TIQ

CRICKET Australia is not the only organisation that has been handed a scathing review of its culture.

There’s talk on George St of a similar document floating around about Trade and Investment Queensland. TIQ is chaired by former Beattie government minister Steve Bredhauer, who earned the call-up in 2015 and has been traipsing around China, Vietnam and Mongolia as Queensland’s special trade rep.

Australia’s former ambassador to Spain, Andorra and Equatorial Guinea, Virginia Greville, has been TIQ’s chief executive officer since 2017. While there’s no suggestion of anyone fiddling around with sandpaper, several international commissioners have left their posts and staff morale is in freefall.

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WARREN CAUGHT IN LNP STOUSH

THE long march of the LNP’s Christian soldiers made its way out to Moggill this week. Among the victims was Metro West chair Leigh Warren when more than 100 members unexpectedly turned up to vote on party positions. No wonder the Prime Minister ditched the ScoMo Express for his plush RAAF jet. He couldn’t get out of town quick enough.

Warren had previously featured in the “Flegg tapes” when former Moggill MP Bruce Flegg secretly taped his conversations amid efforts to parachute Campbell Newman into his seat.

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TAKES WORK TO CLEAR BACKLOG

EXCLUDING Christmas Eve and New Year’s Eve, there are just six Mondays left in 2018.

That means just six opportunities are left for the Palaszczuk Government to hold its weekly get-togethers.

While some scorn Cabinet meetings as chin-wagging sessions, they’re essential for getting stuff done.

However, following repeated cancellations of Cabinet, a significant number of submissions are now backed up.

The Department of Premier and Cabinet is warning of the need for submissions to be prioritised so ministers only consider the most pressing issues.

Obviously, holding more meetings for longer periods to get the work done mustn’t be an option.

Originally published as Queensland is fertile ground for growing scourge of car insurance claim farming