The government has announced reforms regarding personal injury claims, particularly claims involving road traffic accidents (RTA’s).
In a host of measures introduced in a new Bill, from October 2018, the small-claims limit for Road traffic accident claims will be increased to £5,000, but a more stringent threshold of £2,000 will be placed on other claims.
The move comes as part of the Prisons and Courts Bill, brought by the Ministry of Justice (MoJ) in an attempt to get to grips with a compensation culture – with whiplash and soft tissue injuries making up a large number of claims each year. Justice minister, Sir Oliver Heald has suggested that the rules under the current system allow for fraudulent claims.
The MoJ has made the move expecting insurance premiums to be reduced by approximately £40 per year, as insurers previously stated that these contribute to increased premiums.
The changes are set about by tariffs according to length of time that physical or psychological effects are judged to have – the caps are: £250 for injuries lasting up to three months, £450 for six months,£765 for nine months; the compensation range rises to £3, 725 for those whose injuries last up to two years.
Whiplash claims annually have remained around the 680,000 mark, and accounts for 90% of all RTA claims, and the new regulations mean that it will cut out swathes of work undertaken by claimant lawyers, that the government believes, in low value cases, are unnecessary.
The Law Society have said that the new measures will prevent people from obtaining the proper legal advice they need, and undermine people’s rights to accessing full compensation. Judges suggest that the number of claimants bring in claims will clog up the judicial process.
A further measure taken by the Bill is to ban any settlement without medical evidence in RTAs, which includes solicitation, receiving and accepting such offers.
The measures will exempt more serious psychological distress and injury such as depression, post-traumatic stress disorder (PTSD) which have standardized testing procedures, with the new tariffs covering only temporary disorders, such as travel anxiety or shock.
Mark Hunter, head of personal injury at Mackrell and Thomas, no win no fee solicitors says that the new changes “take away peoples rights that have existed for many years, just to increase insurers’ profits”.