The Claims Management Regulator (CMR) has released its 2017 annual report summarising the regulator's main developments and achievements in claims management regulation over the last 12 months.

Claims management landscape

The last year has seen the number of authorised CMCs reduce by 21% from 1,752 in 2014 to 1,388 in 2017. This is likely due to regulatory reforms and a continuingly changing claims market which has impacted the number of new applications. Only 107 new applications were made in 2016/17 compared to 304 made in 2014/15.

In particular, the personal injury (PI) sector saw a reduction in turnover of 41% in the last two years from £309.7m to £182m. However, despite this, the PI sector is still one of the main sectors dominating the CMC market share alongside the financial claims sector.

Despite the reduction of CMCs operating in the personal injury sector, this may be set to change depending on the effect of the Civil Liabilities Bill. The proposals contained in the Bill are likely to reduce the number of claimant solicitors, possibly allowing CMCs to fill the gap.

Enforcement actions and compliance

The last 12 months witnessed the CMR stepping up its enforcement action and cracking down on non-compliant behaviour. Data across all sectors shows 69 licences were cancelled, 196 warnings were issued for breach of the rules, and fines totalling £1.1m were issued. The CMR has conducted more investigations in the year 2016/17 than in any previous year, in a bid to wrestle back control of this sector.

Holiday illness developments

The CMR acknowledged the number of CMCs in this sector is rapidly increasing, and bringing a surge of fraudulent claims in tow. As a result the CMR has issued specific guidance for those involved in holiday illness claims and commenced a programme of audits to ensure CMCs in this sector are complying with conduct rules. This is one of several initiatives in the holiday illness claims sector and it is to be hoped it bears fruit.

Next steps for 2017/18

The CMR have stated their priorities for the next 12 months in relation to personal injury claims will be to:

  • closely monitor CMCs compliance with holiday illness claims;
  • ensure any arrangements fully comply with the referral fee ban; and
  • identify CMCs marketing by telephone and ensure the information they provide is not misleading.