Pressuring people into making any personal injury compensation claims via ‘claim farming’ became officially illegal in Queensland today.
Queensland Attorney-General Justice Shannon Fentiman late this afternoon said the passage of the Personal Injuries Proceedings and Other Legislation Amendment Bill 2022 banned the insidious practice.
Claim farming involves third-party agents cold-calling people in a bid to coerce them into making personal injury claims – usually as a result of workplace injuries or car crashes.
The move comes after years of strong Queensland Law Society advocacy to outlaw claim farming and 2½ years after the implementation of the Motor Accident Insurance and Other Legislation Amendment Act, which commenced on 5 December 2019.
The reforms also prohibit the giving or receiving of financial incentives for referring claims or potential claims.
Ms Fentiman said the new laws would stamp out the practice by prohibiting anyone from approaching another person without their consent and “soliciting or inducing” them to make personal injuries claims.
“Claim farmers cold call or approach individuals to coerce them into making a personal injury or workers’ compensation claim and then charge a fee to ‘sell’ their claim to a legal practitioner or other claims management service providers,” she said.
“It is also now an offence to pay claim farmers for the details of potential claimants, or to receive payment for a claim referral.”
The new laws build on the success of changes introduced by the Queensland Government in 2019 to stop the increasingly prevalent practice of claim farming for motor vehicle compulsory third party (CTP) claims.
“Since those CTP claim farming reforms commenced in December 2019, the Motor Accident Insurance Commission has recorded a significant drop in the number of people reporting they are being harassed by claim farmers,” she said.
“However, due to the success of the reforms, the claim farming industry has pivoted to new types of personal injury claims, with reports that claim farmers are targeting personal injury claims, including those involving institutionalised child sexual abuse, and workers’ compensation claims.
“These new laws address this by prohibiting claim farming and breaking the nexus between claim farmers and legal practices by requiring law practices to certify that claims they are representing have not been farmed.”
Industrial Relations Minister Grace Grace said she was proud that the Queensland workers’ compensation scheme would be the first in Australia to specifically legislate against claim-farming activities.
“The amendments also ensure workers who unfortunately sustain a work-related terminal condition are able to access terminal compensation when they most need it,” Ms Grace said.
“Queensland is the only jurisdiction in Australia to offer broad-ranging statutory terminal compensation of this nature.
“The workers’ compensation regulator also has expanded compliance and enforcement powers to effectively prosecute claim-farming offences, and these are consistent across the schemes, ensuring there are no weak points to be exploited by claim farmers.”
Ms Fentiman said the new laws would not affect the rights of genuinely injured Queenslanders to access justice.
“Claimants can still initiate and progress legitimate claims under the Personal Injuries Proceedings Act or the Workers’ Compensation and Rehabilitation Act,” Ms Fentiman said.
“The new laws will, however, prevent claimants or potential claimants from being incentivised, harassed, and induced into making a claim by a claim farmer who will receive payment for the referral.
“The laws remove the financial incentive for claim farmers to harass Queenslanders and ensure the justice system is not burdened by the cost of unnecessary personal injury and workers’ compensation claims.”
Read more: Important changes for PI practitioners
The new claim farming laws will be featured at the QLS Personal Injuries Law Conference on 1 September. Learn more