Lawyers have given a strong reaction to government proposals to remove or cap whiplash damages and increase the small claims limit for personal injury cases.
The proposals were announced this week in a Ministry of Justice (MoJ) consultation, Reforming the Soft Tissue Injury (whiplash) Claims Process. They are to remove compensation for pain, suffering and loss of amenity for whiplash claims, or cap them at £425. The small claims limit would be raised from £1,000 to £5,000 and the government would ban settlement of whiplash claims without a medical report from an accredited medical expert. Claimants would still be able to sue for loss of earnings, medical costs or other forms of loss. A tariff system would be introduced for more serious injuries.
In the foreword to the proposals, Lord Keen, MoJ spokesman in the House of Lords, said the number of whiplash claims had risen by 50% in the past decade despite fewer accidents being reported. The average payment for a minor whiplash claim is £1,850 and the cost of dealing with them “is out of all proportion to any genuine injury suffered”.
However, Brett Dixon, vice president of the Association of Personal Injury Lawyers (Apil), called the proposals “heavy handed and excessive”. Instead, the government should focus on banning cold calling by claims management companies, he said.
Dixon said the proposals would force the vast majority of personal injury victims into the small claims court, where they would have to front the cost of bringing a claim themselves.
Ian Davies, partner at insurance law firm Kennedys, said the proposed reforms on whiplash claims “will come as a significant boost to many insurers and a severe blow to many in the claimant market, who were no more than a month ago celebrating the reforms being seemingly shelved.
“The boundaries of the consultation appear to go further than previously proposed. Consequently, it is sure to generate a forceful response from all quarters. What the government must also consider is the potential for unintended consequences.”
