16th March 2017

The government recently announced changes to the personal injury (PI) compensation system. Ben Hoare Bell Partner and Personal Injury Solicitor Adrian Dalton explains how these changes will affect things.

The government intends to change aspects of the system from October 2018. Changes include:-

a. Road traffic accident related injuries – normally if you win a PI case the insurance company compensating you must pay compensation and also your lawyer’s fees. But the rule about fees does not apply to a “small claim”. For PI a small claim is one worth less than £1000 for injuries. In car accident cases the government wants to raise that limit to £5000 – quite a hike. Also it wants to introduce set tariffs for compensation paid according to the sort of injury. For instance if you recover from injuries within 6 months you will get £450. Many commentators think these new tariff levels are quite mean.

b. Other PI claims – these claims include getting injured at work or by defective goods etc. The government will raise the limit to £2000 for these – a much smaller rise. The limit last went up in 1991 – from £500 to £1000. Putting it up to £2000 is in line with inflation since then.

It is very likely the changes will happen not least because the date for them is so far ahead. Plenty of time has been allowed for any legal or other challenges and for general debate.

One effect of the changes will be to exclude solicitors from a lot of cases – because there is no provision to pay solicitors fees for some cases. And the knock on effect of that may be fewer cases brought or succeeding. Because compensators – usually insurance companies – can keep employing lawyers to do small claims court cases and claimants bringing cases without legal representation will struggle to win against such opposition.

What you think about these changes may depend to an extent on what you think about PI claims. But leaving that aside some commentators think one troubling point is: where is the logic of having one system for car accident cases and a quite different system for OTHER accidents?

And if logic is lacking here is it possible that later government might choose to change other parts of our justice system in similarly illogical ways?

One thing is certain: insurance companies will be paying out less in compensation and less in legal fees. That should mean all our insurance premiums go down – surely?


 

Blog by Partner and Personal Injury Solicitor, Adrian Dalton