The Government has announced that plans to overhaul certain types of personal injury claims in the UK will be released by the Ministry of Justice (MoJ) by the end of 2019.
This is part two of the overhaul, following the changes being introduced in the Civil Liability Act, which will bring into place:
- Fixed compensation levels for road traffic accident (RTA) compensation claims; and
- A limit of £5,000 for small claims.
The changes implemented in part one were as a result of the consultation paper, Reforming the Soft Tissue Injury (whiplash) Claims Process, which was published in November 2016. The paper focused on views relating to:
- Credit hire (e.g. when a person’s vehicle is not roadworthy and they cannot afford the repairs or pay the costs upfront to hire a replacement car, then a hire car is obtained on credit and paid for at a later date);
- The timing of claims notification;
- Rehabilitation and therapy;
- Disbursement costs (e.g. Court fees, medical or other expert report costs, etc.); and
- An overhaul to the overall approach to personal injury claims.
The Justice Minister, Paul Maynard, has said that the Government are still considering the matters raised within part two of the consultation report and that further changes will be revealed later this year. These changes could have a wider ranging impact on RTA and whiplash claims than those in part one.
What’s the need for the changes?
The overhaul of personal injury compensation claims was highlighted by the Government to tackle fraudulent claims in the sector and the associated costs (e.g. legal, credit hire, rehabilitation, etc.) relating to what is considered to be more minor claims, e.g. whiplash.
The Association of British Insurers (ABI) believe that in certain cases that rehabilitation or therapy is not always required. Consequently, the costs associated with these claims is substantially higher. Additionally, the ABI commented:
“As with credit hire, the overall effect of this approach is to relegate the interests of the claimant themselves behind various commercial organisations using their low-value injury claim as a means to gain access to the market.”
The ABI are also of the opinion that if a person, who is not to blame for an accident, is making a claim a month after the RTA took place that they should pay the disbursement costs. But if it’s within a month of the accident taking place then the insurer would cover these charges.
However, these opinions have been challenged by the Association of Personal Injury Lawyers. They feel that these time limits on disbursement costs would be unfair on those who have genuine reasons for not making a claim within the one month time period. Also, that the changes could make it much more difficult for people to obtain therapy or rehabilitation when they need it.
How Nelsons Can Help
If you have any questions in relation to the topics discussed in this article, please contact a member of our expert Personal Injury team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online form.