Controversial whiplash claim reforms took a step nearer to reality at the end of October, when Labour amendments were defeated and a second reading of the Civil Liability Bill opened up a debate and voting, which saw it advance to the final stages.
The bill aims to introduce a fixed tariff for whiplash damages and will be compensated by a rise in the small claims limit to £5,000 for road traffic accident claims. The objective is to curb what is called a ‘compensation culture’ and cut down on ‘rogue’ claims, but opposition to the bill believes it penalises ordinary injured people who are making genuine claims.
Labour proposed amendments which would have restricted a rise in the upper limit to the small claims track, but the limit change now means that legal costs cannot be recovered when the damages awarded are under the limit.
Approval of the Civil Liability Bill
October 23rd saw the bill and its proposed amendments debated again, with the Government winning the resulting vote by a majority of 56, and therefore the third reading was approved. The bill “…seeks to reform the claims process for whiplash claims with injuries lasting up to two years resulting from road traffic accidents, and to make changes to the way in which the personal injury discount rate, applied to lump sum awards of damages for future loss, is set.” These changes will now come into effect from April 2020.
The amendments proposed by Labour would have linked increases in the whiplash small claims limit to inflation, while another amendment would have removed tariffs for whiplash injuries. Labour preferred the current system whereby judges decide compensation levels.
Insurance companies are the big winners
Chris Philp MP, speaking for the Government, claimed the current system was broken. This had created a “one-way bet”, he claimed, that subsequently had caused the compensation culture currently being experienced by the insurance industry. The legal sector believe insurance companies are the big winners in the latest advancement of the bill, with ordinary people paying the price and gradually seeing their rights being reduced.
Justice Minister Rory Stewart also stressed the role of the new online portal for handling claims in the absence of a lawyer. This was hailed as a great benefit in logging claims for people using the small claims court. Providing a straightforward and accessible claims logging process would be a great benefit to people, but it was also conceded that the system required extensive testing before it could be fully rolled out, given that the Government’s record in delivering IT systems was “not always unblemished”.
If you have any questions about the proposed whiplash reforms, please contact Gareth Naylor on 0113 284 5000 or email firstname.lastname@example.org