An increase in the growing compensation culture is hitting UK businesses, costing them time and money, suggests research.
Financial resources are having to be diverted by 49% of companies, to deal with cases and 46% say compensation claims cause too much red tape.
Such findings are part of a survey from Aon which indicates 75% of businesses see the trend towards compensation creating an unsustainable burden for businesses in industry, commerce and public services.
At least 62% of companies have seen an overall increase in the cost of claims to their business while managers are having to spend more time sorting out claims, according to the 60% of firms who fear their business are being hampered as a result and 96% feel the Government needs to do more to tackle the issue.
The situation is not helped by the reluctance of insurers to take the cheaper route of settling claims out of court rather than defend against them, suggests Aon.
"One possible consequence of this might be an increase in the total number of fraudulent or spurious claims that ordinarily would not stand up in court," said Max Taylor, deputy chairman at Aon.
One solution businesses are finding on their own is to offshore business activities away from the UK as companies seek to minimise their risks and the chances of being sued.IFAonline
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