Road traffic accident claims: whiplash reforms to come into force on 31st May 2021
The long-awaited whiplash reforms have been delayed again and are set to be implemented on 31st May 2021. The reforms have been in the pipeline for some time now, having been put back three times since they were due to come into force in April 2020.
What are the whiplash reforms?
The whiplash reforms are a package of measures being introduced by the Government to modify the way low-value personal injury claims arising from road traffic accidents (RTAs) are managed.
Insurance companies have long been campaigning for reforms to the current process as they believe this will reduce the volume of low-value claims they receive. In turn, it is hoped that the savings made by insurers will lead to reductions in insurance premiums for motorists.
What are the main changes to RTA and personal injury claims?
Expand the scope of the small claims track
Currently, if an individual makes a claim for personal injury and it is valued at less than £1,000, it will fall into the small claims track and you are not entitled to recover legal costs from your opponent. The reforms will increase the small claims track limit to £5,000 for RTA claims, however, it will remain at £1,000 for all other personal injury claims.
This means that under the reforms, if you have been injured in an RTA, your injuries must be valued in excess of £5,000 in order to pursue a claim with the assistance of a specialist personal injury solicitor.
There are some exceptions to the new £5,000 limit in RTA claims. These include:
- Where the Claimant is a child or protected party;
- Where the Claimant was a ’vulnerable road user’, e.g. motorcyclists and pillion/sidecar passengers, cyclists, pedestrians, horse riders and those using mobility scooters;
- Where, on the date proceedings started, the Claimant is an undischarged bankrupt, or the Claimant or Defendant acts as a personal representative of a deceased person; and
- Where, on the date that the accident occurred, the Defendant’s vehicle was registered outside the United Kingdom.
If a case falls into one or more of these categories, the old £1,000 limit will continue to apply and the normal track for the claim will be fast track, which means that individuals will still be able to seek the assistance of a solicitor.
Introduction of a new online portal
The Motor Insurers’ Bureau (MIB) have been tasked with building a new online portal for submitting low-value personal injury claims. The idea is that Claimants will be able to submit a claim themselves using the online system without the need to instruct a solicitor to fight their case. It is believed that the new measures may put many accident victims off claiming compensation for their injuries due to concerns over the complexity of bringing a claim without legal advice.
New whiplash injury tariffs
The third major change set to come in is the introduction of tariffs (for whiplash injuries lasting less than two years) to decide how much compensation a person should receive for their injuries. These tariffs will limit the amount of compensation awarded to Claimants compared to the current system in place. Under the new tariffs, Claimant’s will receive between £235.00 and £3,910 for injuries lasting less than two years.
What is the likely impact of the changes to whiplash claims?
Under the new rules it is likely that a high majority of whiplash claims will fall below the £5,000 limit set to be introduced. This will leave many Claimants to represent themselves in what can be very complex matters.
We await to see whether any savings made by insurance companies are passed onto customers by way of reduced insurance premiums.
Many professionals remain dubious as to whether the delay is sufficient to ensure the infrastructure is in place to deal with the new regulations and whether the changes will come into force in May as planned. There is also concern that people who are injured in an RTA through no fault of their own may no longer be able to access proper compensation for their injuries.
It should be noted that any claims started before the reforms are implemented will continue under the current process for low-value personal injury claims.
We will update you on any further updates on the whiplash reforms and what this means for RTA victims.