It finally seems that the government have set a date for bringing the so-called ‘whiplash reforms’ into force. Provided no further delays occur, the reforms – which are contained in the Civil Liability Bill – will be introduced by 31st May this year.
The reforms have been designed to reduce the number of fraudulent road traffic accident (RTA) whiplash claims, otherwise known as ‘crash for cash claims’.
Having initially been proposed in 2015, the reforms were planned to take effect last year, but were pushed back due to the COVID crisis.
How will drivers be affected by the new whiplash reforms?
Although the reforms promise to be a positive step towards reducing the time and money spent on fraudulent claims, there are concerns as to how this could affect drivers who find themselves needing to make a genuine claim after a road traffic accident.
The measures put in place mean that legitimate personal injury claims may be far more difficult to process. Likewise, there will be tariffs (set compensation figures) put in place to limit the amount of compensation that can be awarded to claimants.
On a more positive note, however, it is hoped that the reforms will help to reduce the cost of insurance for motorists overall, which will come as welcome news to many. This is because the changes will lower the cost of whiplash claims to insurers.
What changes are included in the reforms?
There are a variety of changes included as part of the reforms. Firstly, there will be a ban on making or accepting settlement offers for a whiplash claim without a medical report. This is to deter fraudulent claims where the injury can’t be proved.
The process of making a personal injury claim will also change, with the introduction of an online claims portal. The Official Injury Claim portal, which will be introduced in May, will allow an injured person to log their claim online and manage it electronically from there.
To combat the costs associated with whiplash claims, there will also be a new system of tariffs implemented with the Bill. The tariff system decides the amount of money which can be awarded as claimant compensation for pain, suffering and loss of amenity. Under the current tariff system, a claimant can be awarded up to £1750 on average for an injury lasting up to 3 months, and £4000 for an injury lasting between 9-12 months. However, from 31st May, these amounts will fall dramatically to an average of £225 for an injury lasting up to three months, and £1250 for an injury lasting between 9-12 months.
Lastly, there will also be changes to the small claims track limit. This limit decides which cases can be solved in the small claims court, and which claims tend to need the services of a solicitor. At the moment, any whiplash-related claims below £1000 go to the small claims court, and are usually handled without the need of a solicitor. However, the new reforms will increase the small claims track limit from £1000 to £5000. This means that, for any whiplash claims valued under £5000, the injured person may not be able to pursue their claim with the assistance of a solicitor.
Have you got motor legal cover in place?
As an optional extra to your Norton policy, motor legal cover provides legal support in the event of a road traffic accident claim. This will be increasingly valuable once the reforms come in as without this cover, the onus falls on the claimant to manage their claims process.
To find out how you can get motor legal cover, speak to your personal client manager today or call one of the team on 0121 248 9440.