Key players in the £100 million legal action against more than 600 firms involved with The Accident Group (TAG) appear to be moving towards some form of settlement, the Gazette has learned.


Two insurers, Europ Assist and a consortium of Lloyd's insurers, are said to be very close to reaching a deal which could be finalised by the end of spring, according to sources close to negotiations.



The step-change in discussions relates to the repayment of an 'investigation fee' paid by law firms to TAG sister company Accident Investigations Limited (AIL), which was later ruled to be a then-illegal referral fee.



The second action, alleging TAG panel law firms were negligent in failing to vet and monitor personal injury claims properly, remains more problematic. The firms involved strongly deny any allegations of negligence.



A satisfactory settlement will be welcomed by both sides now keen to avoid lengthy trials and adding to already hefty legal costs in what is thought to be the biggest claim ever made against the legal profession.



However, issues as to damages, multiple excesses and negligence remain highly contentious.



A Europ Assist spokesman was unable to comment. Ian Herbert, the partner at Welsh firm Hugh James who acts for the Lloyd's group, could only say discussions at the mediation were 'meaningful' and ongoing. Insurer QBE, acting for some defendant firms, was also said to be chasing a final agreement but declined to comment.



Glenda West, director at broker Prime Professions, warned that firms should be wary of accepting offers without consulting their brokers or seeking independent advice.



She said: 'Things are beginning to move as a result of the mediation process. Those firms affected should be prepared to contribute towards settlement, probably on a global basis likely to include AIL fees.



'My advice is to take a step back to consider whether the settlement is acceptable. The critical point is the number of excesses applicable and whether they apply to each claim in these circumstances.'



Anita Rice