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Allianz enjoys significant High Court victory

Allianz enjoys significant High Court victory | Insurance Business

Allianz enjoys significant High Court victory

There has been a grey area looming over personal injury claims, surrounding the issue of fundamental dishonesty. However, a High Court appeal victory for Allianz and Keoghs may have changed that.

The Pegg v Webb and Allianz appeal ruled the claimant to have been fundamentally dishonest and ordered him to pay 70% of Allianz’s costs. The decision, according to a Press release issued by insurance law firm Keoghs, means that failing to disclose essential information and lying about the extent of injuries does go to the root of a claim and therefore should be deemed fundamentally dishonest. In particular, it noted that “where fraud is pleaded and the claim is dismissed but the defendant fails to establish fraud, it is still not appropriate for costs to be awarded to the claimant.”

The case that sparked the court tussle originally occurred when a personal injury claim was submitted after an alleged collision back in 2016. In that incident, the claimant was a passenger in a third-party vehicle.

However, Allianz believed the accident may have been staged and the claimants’ injuries exaggerated – bringing in the law firm.

A judge ruled the collision was genuine and caused by the insured driver’s negligence, but also outlined that the claimant exaggerated the extent of their injuries – and, as such, their personal injury claim was dismissed. Still, the claimant was deemed entitled to 60% of his costs as Allianz didn’t establish the accident was fraudulent.

That prompted Allianz and the law firm to appeal the decision on two grounds – namely that the claimant was fundamentally dishonest in claiming for a six-month injury when he actually recovered in a few weeks; and secondly, that it was wrong in law and principle for the court to order Allianz to pay the claimant’s costs given the claim had failed.

Ultimately, at the High Court in Birmingham, Mr Justice Spencer agreed with the appeal.

“We are delighted with the result of this appeal as we strongly believed that the original finding did not reflect the dishonest nature of the claim which was presented in court by the third party,” said James Burge, fraud manager at Allianz Insurance. “It was an unusual decision for the court to order Allianz to pay the court costs when a claim had been dismissed, so we were confident this should be challenged.

“We will always take action and defend spurious claims where we believe that an element of fraud is at play. Working together with specialists such as Keoghs demonstrates our ongoing commitment to challenging and tackling insurance fraud.”

“This is an important decision. It confirms that where a claimant claims for injuries in excess of those suffered and fails to disclose a relevant accident, the claim is fundamentally dishonest,” added Keoghs solicitor Nigel Parker. “It also confirms that where a defendant fails to establish fraud, but the claim is dismissed, it is not appropriate to award a claimant any costs. It is still open to the court to find that the claimant is fundamentally dishonest for other reasons and order the claimant to pay the defendant costs albeit with a small reduction for costs incurred investigating the genuine nature of the accident.”