Claims management companies “are pulling out” of holiday sickness claims as “almost every claim” is reviewed for “fundamental dishonesty”, says a leading industry lawyer.

Claire Mulligan, partner at law firm Kennedys, said: “We’ve run 80 cases to trial and won 72. Six couples have been sent to prison and we’ve also had suspended sentences. Two claimants’ experts have run out of court in tears.”

Mulligan told an Abta Travel Law Seminar in London: “Litigation is at the same level [as last year], but the number of claims has fallen. We’re seeing companies pulling out of the market.

“We’re looking at fundamental dishonesty on almost every claim. Judges don’t like people fibbing. But you need clear evidence.”

Sarah Prager, barrister at law firm 1 Chancery Lane, agreed saying: “We’ve gone from judges believing claimants almost by default, to judges disbelieving claimants almost by default, and 
a lot of that is down to Abta.”

However, Abta senior solicitor Susan Deer warned: “We’re concerned that claims companies think they can still make money from cruises and accidents [overseas].”

She said: “We’ll continue to raise awareness and deter fake claims through the media.”

In April, the government announced new rules to fix the legal costs in sickness claims and pledged tougher regulation of claims management companies. Justice minister Rory Stewart warned: “Claiming compensation for being sick on holiday, when you haven’t been, is fraud.”

Prager expressed sympathy for claimants who end up in court, saying: “They are persuaded it will be easy money, then find themselves being cross-examined and it’s terrifying. It is the claims management companies that are the problem, but they don’t bear the risk.”