What's in store for 2023?

For momentous events, the year 2022 is a hard act to follow. It will linger in the memory for a long time, with record inflationary rises, three Prime Ministers, the first European War since Bosnia and the death of Queen Elizabeth II.

Given those news events were not foreseen, what chance is there of predicting what will happen in 2023? Nostradamus has left his view: a great war, economic ruin, and a dry earth that floods.

Closer to home, what are the trends and where are they going? What is the focus for risk managers and claims handlers?

Claims

Social care claims remain the largest drain on resources. 2019’s victory in CN & GN v Poole became 2022’s problem in HXA & YXA. The Court of Appeal (led by a Family Law Judge) found the question of assuming responsibility leading to a duty of care, would need to be decided case by case at trial. At a stroke claims with little to no prospect of success have become impossible to strike out, leading to expensive litigation costs.

This saga is again moving to the Supreme Court. It remains to be seen if the measured common law approach to duty of care will be repeated and re-open the door to striking out weaker cases.

After almost three years of delayed work due to COVID-19, almost every street in Britain is covered in roadworks with temporary traffic lights. Expect claims activity from these and where poor reinstatements have been made. The hot summer, wet autumn and winter cold snaps mean there are many potholes. Highway claims will return.

Human rights claims have been increasing over recent years, particularly in a social care context. The useful 2022 case of AB v Worcestershire has been appealed, resulting in another big day in court for 2023.

Finally, the wave of COVID-19 claims feared in 2020 has not yet materialised, but 2023 will decide if it does. The third anniversary of the first lockdown is 23 March.

The economy

Bill Clinton once said: “it’s the economy, stupid.” In 2023 those words seem prophetic.

The general population has been suffering wage stagnation as fuel and food prices rise. Interest rates are up, and all households are suffering. This means maintaining income and seeking compensation for losses become all the more important.

Translated into interactions with public authorities, that means intolerance of perceived poor service, a willingness to claim, and much greater service demand.

The other side of that is a public spending round that caused a number of authorities to warn of solvency dangers. Inflation makes providing services more expensive and there is no new money for councils in 2023. Given the social care budget is now one of the largest for councils, cuts hurt here. Increased claims activity will flow from this.

We are witnessing the start of a perfect storm, with more demand for services from an increasingly rights-conscious populace, to be delivered by a cash-strapped sector.

Environment

2022 was one of the hottest years ever. We had a heatwave, floods, and the unpredictable climate continues to damage infrastructure, causing claims.

This trend will grow, especially as the summer 2022 subsidence claims appear. Highway authorities should also look out for claims arising from highway design and its effect on surface water runoff.

Justice

As anyone waiting for trial in a personal injury case knows, the civil courts are backlogged. Similarly, coroners are years behind with inquests. This is slowing cases dramatically and increasing expense as cases take longer to conclude.

The Human Rights Bill has also stalled. There is no date for its second reading. Accordingly, the hope of seeing trivial or low value Human Rights Act cases disappear has gone. This, of course, feeds into a general election campaign.

The UK COVID-19 Inquiry

Three investigation modules are up and running. There is clear local government involvement in modules one and two from the Local Government Association and Association of Directors of Public Health. However so far, no individual local authority has become a core participant, or been the subject of investigation. The Inquiry seems to want to look at local government as a whole.

This approach is problematic, local authorities are individual and different and their pandemic responses reflected this. A one size investigation fits all approach to the sector will not give an accurate picture of what local government did to fight the pandemic.

There will be individual investigations. Like IICSA before, the UK COVID-19 Inquiry will follow the headlines. Matters like funding in the north west, the regional use of lockdowns or emergence of variants, could be of interest.

The general election

At the latest it will be December 2024. Both main parties started 2023 with campaign style events and speeches, so the race is on. Politically, the whole of 2023 will be dominated by this and there is now insufficient time for long-term policy making. In the face of the country’s challenges, a clear vision is needed, but the political cycle will dominate. That means a year of unpredictability and reactive action.