Categorized | Civil Law, Legal Aid

Personal Injuries proposals

Personal Injuries proposals

In a move described as ‘heavy handed, excessive, and disastrous’ the Ministry of Justice announced last week that it plans to either scrap the right to compensation or, alternatively, put a cap on the amount people can claim for minor soft-tissue injuries. Capping whiplash compensation would see the average pay-out cut from £1,850 to a maximum amount of £425.

MoJ also said it would raise the limit for cases in the small claims court for all personal injury claims from £1,000 to £5,000.Justice secretary, Liz Truss, said: “For too long some have exploited a rampant compensation culture and seen whiplash claims an easy payday, driving up costs for millions of law-abiding motorists. These reforms will crack down on minor, exaggerated, and fraudulent claims.”

Writing in the ‘Gazettre’ John Hyde said “Truss is a ‘compensation culture’ devotee – and she is about to wreak vengeance on the personal injury sector… (the) announcement is a disaster for claimant injury lawyers.”

Simon Kirby, the economic secretary to the Treasury, said: “One whiplash claim is paid out every sixty seconds and it is unacceptable that responsible motorists have to pick up the tab. We are tackling the incentives which have created this compensation culture so that all drivers can save money on their motor insurance policies.”

Kennedys partner and motor insurance specialist Ian Davies said: “The news to proceed with the reforms to crackdown on whiplash claims will come as a significant boost to many insurers and a severe blow to many in the claimant market, who were no more than a month ago celebrating the reforms being seemingly shelved.”

The MoJ has also launched a consultation on proposals designed to reduce the number of whiplash claims and allow insurers to cut premiums. The MoJ says the current number of whiplash claims is “unacceptably high” and confirmed that insurers have pledged to pass on savings to drivers – worth a total of £1bn, around £40 per motorist. Whiplash claims are 50 percent higher than a decade ago.

The consultation proposes four central changes and also asks for views on a wide range of other measures. According to the ‘Gazette’ the key measures are:

  • Reduce or scrap damages for soft-tissue injury claims. Minor injuries would be classed as lasting either up to six or nine months.
  • Damages for injuries lasting longer than six or nine months should be graded and fixed according to duration. Minor injuries would receive £400 damages plus £25 for psychological impact. Injuries lasting 19-24 months will have a £3,600 tariff.
  • The small claims limit will rise to at least £5,000. The government’s preferred option is to apply to this to all personal injury claims. A figure above £5,000 is not ruled out. This is the only key measure that would not require primary legislation.
  • A ban on all pre-medical offers to settle. The only question appears whether this should apply only to RTA claims, what exemptions there should be, and how it would be enforced.

The consultation will run until 6 January 2017 and the short consultation period has been criticised for placing pressure on all concerned to evaluate the proposed measures.

This post was written by:

- who has written 462 posts on Upper Case – The Anya Legal Journal.

Mike Gribbin is a retired Civil Servant with wide experience, including the drafting and implementation of Parliamentary legislation and regulations. He is the editor of “Criminal Offences Handbook”, a uniquely comprehensive guide to more than one thousand ways to fall foul of UK criminal law. He is Editor of the Upper Case Legal Journal and has been writing blog posts for the past eight years.

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