horwich farrelly

An end to the teatime call about your whiplash claim?

March, 8, 2018

As the Financial Guidance and Claims Bill moves towards the Report Stage in the House of Commons, John Glen, the Economic Secretary, has written to interested parties to clarify his views on the issue of cold calling.

This falls under clause 4 of the draft legislation and is defined as ‘unsolicited real-time direct approaches to members of the public carried out by whatever means, digital or otherwise’.

Man interupted at home by phone call

Clause 34 deals with cold calling about claims management services (CMS) and if passed would restrict cold calling in relation to such services to circumstances in which the subscriber had previously notified the caller that for the time being he or she consented to such calls being made. In this context, “claims management services” will mean the following services in relation to the making of a claim (including a claim for damages for personal injury):

  1. advice;
  2. financial services or assistance;
  3. acting on behalf of, or representing, a person;
  4. the referral or introduction of one person to another;
  5. the making of inquiries.

The intention of the legislation when passed is effectively to ban cold calling and this raised the interesting issue of how a CMS would gain the necessary consent. The short answer would appear to be ‘with great difficulty’. According to Mr Glen’s letter, it would need to be ‘knowingly and freely given, clear and specific’’, a description which mirrors the forthcoming GDPR regulations, which will be effective from May this year.

The CMS would need to keep clear records as to when and how the consent was obtained. No time limit would be imposed on the retention of the consent but it would not remain valid for ever. The subscriber would be permitted to withdraw the consent.

The Information Commissioner’s Office (ICO) has already published guidance as to how valid consent might be obtained in such circumstances. It must be in accordance with current European Directive 95/46/EC (and from May 2018, the GDPR which will supersede it) and evidence a ‘’freely given specific and informed indication of his wishes by which the data subject signifies his agreement to personal data relating to him being processed”.

The individual must have a genuine choice over whether or not to consent to the marketing; the consent must be specific to the marketing in question; the subscriber must understand what they are consenting to; and consent must be a positive expression of choice.

As the ICO guidance points out, there must be some form of communication or positive action by which the individual clearly and knowingly indicates their agreement to being contacted via specific channels (e.g. post, email, live phone call, etc). This must be in the context that they fully understand that their action will be taken as consent, and must fully understand exactly what they are consenting to.

What is the likely impact of this on a CMS trying to ‘harvest’ a claim following a road traffic accident? The CMS learns of the accident and the potential claimant’s involvement. A cold call, inviting the claimant to make a claim would be unlawful.

Once the Bill passes into law, there would appear to be no lawful alternative but for the CMS to write to the claimant to ask if he or she consents to being contacted for the purposes of a possible claim for damages. A refusal of that request, or a failure on the part of the individual to respond would bar the CMS from making any further approach.

So, teatime may be undisturbed? We’ll see…

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