This article originally appeared in Modern Claims Magazine, Issue 17, January 2016
As everyone in the accident claims community will know by now, the Chancellor of the Exchequer dropped a double bombshell in his Spending Review and Autumn Statement. Announcing a new round of motor accident claims reforms, he signaled a substantial increase in the Small Claims Limit and the removal of the right to claim general damages for “low value” whiplash.
Just one of these measures would have severely impeded the ability of accident victims to seek the full justice they deserve, but both together will have very serious implications. And it of course follows that the imposition of these measures would raise questions about the very future of independent legal advice in the sector.
It simply cannot be right to deal with the purported compensation culture by removing the right to claim compensation from those who suffer injury as a result of negligent driving, in order that the insurers for the negligent driver can save money. There is a significant risk that the NHS and the benefits system will be left to pick up the bills that are currently met by the insurers for the at-fault driver.
Denying accident victims access to independent legal advice at the cost of increasing the profitability of insurance firms, who have a very poor record of passing on any savings, is scandalous and blatantly unfair.
We are yet to fully understand precisely what is being proposed – does the increase in the Small Claims Limit apply across the board? What is the definition of minor whiplash? What is clear is that the Government has fallen foul of listening to only the self-interested views of the insurance sector who wish to maximize their profitability at the expense of all motorists.
Accidents will of course still occur in the hundreds of thousands on UK roads – and injured victims will still require support. I fear that these reforms, inexplicably announced ahead of the conclusion of the Insurance Fraud Taskforce and the CMC review, could have significant unintended consequences and are certainly not guaranteed to achieve the stated objective of reducing claim numbers. These measures will cost the Treasury hundreds of millions in lost revenue and it will all be so sadly predictable when, despite all this, insurers find some other excuse and premiums continue to rise.
MASS will work tirelessly in the months ahead alongside others in the sector to combat these profoundly unfair and highly damaging proposals. No-one in the sector can do otherwise.