Will personal injury reforms impact represented claimants?
Civil Liability Bill introduces a RTA whiplash claims general damages tariff, and bans settling personal injury claims without medical evidence.
The personal injury sector is waiting with bated breath for the Civil Liability Bill ("the Bill") to land. The Bill is reported to be the resurrection of proposed personal injury reforms which were contained within the defunct Prisons and Courts Bill. Whilst more detail on the contents of the Bill is awaited, we do know that it will introduce a tariff of general damages for RTA whiplash claims, as well as a ban on settling personal injury claims without medical evidence.
We understand that the Bill will include a tariff for RTA whiplash claims which is likely to be similar to that contained in the Prisons and Courts Bill which had the following proposed tariffs:
|Injury Duration (months)||2015 average payment for PSLA (industry data) (£)||Judicial College Guidelines (13th edition) (£)||New Tariff Amounts (£)||Saving (£)|
|0-3||1,750||Up to 2,050||225||1,525 – 1,825|
|4-6||2,150||2,050 – 3,630||450||1,700 – 3,180|
|7-9||2,600||2,050 - 3,630||765||1,835 – 2,865|
|10-12||3,100||2,050 – 3,630||1,190||1,910 – 2,440|
|13-15||3,500||3,630 – 6,600||1,820||1,680 – 4,780|
|16-18||3,950||3,630 – 6,600||2,660||1,290 – 3,940|
|19-24||4,500||3,630 – 6,600||3,725||775 – 2,875|
It is also expected that the Bill will include an outright ban on making, soliciting or accepting an offer of settlement prior to the service of medical evidence in support of the claim.
Coupled with the proposed increase in the small claims track limit to £5,000 for RTA personal injury claims and £2,000 for all other personal injury claims, these reforms represent a significant change to the rules on how personal injury claims can be brought and compromised.
Whilst the proposed reforms will serve to reduce the spiralling cost of personal injury claims, it is also expected that the reforms will positively impact the number of fraudulent claims by reducing the financial rewards available for those looking to take advantage of the system and removing those parts of the claims process which were open to exploitation.
Litigants in person
As a natural consequence of the proposed reforms there may be an increase in those bringing claims without the benefit of legal representation, known as litigants in person (“LIPs”).
Dealing with LIPs currently creates a myriad of issues for compensators and their representatives. The Personal Support Unit have in the past stated that of all LIPs that they provide assistance to in the RCJ, 30-40% had cognitive impairment, and 25% of all LIP’s across the UK have English as their second language. LIP’s tend to have a lack of understanding of complex procedures and protocols, as a result of which compensators, their representatives and the judiciary often have to spend a significant amount of time steering LIPs through the litigation process. The MoJ has also recently reported that in 36% of all applications in the family court, neither the applicant nor the respondent were legally represented, resulting in a significant increase in the time taken to dispose of these matters.
Compensators are likely to see an increase in the number of occasions where they are having to deal with claimants unfamiliar with the claims process. Whilst LIPs have always been involved in the personal injury claims process, there is a need for intelligent solutions to address that challenge in the face of an anticipated increase in the volumes of LIPs.
Such solutions need to be focused on creating a level playing field where LIPs can bring claims in as straight forward a manner as possible, minimising the impact on costs and claims lifecycles whilst preserving access to justice without diluting standards of judicial scrutiny.
There are a multitude of different options that might be looked at, ranging from giving LIPs access to the claims portal and other online tools, simplified guidance notes, mandatory mediation in LIP cases, creation of new simplified court forms and perhaps even an initial judicial assessment of the merits of LIP claims upon issue, consistent with the ethos behind the work being undertaken pursuant to the recent Briggs report.
We understand that the MOJ has already formed working parties with various stakeholders looking at the creation of new protocols and rules to assist LIPs in bringing claims without legal representation.
Whilst that is a welcome step, LIPs already account for an increase in resource demand due to the higher number of touch points with insurers, together with an increased claims lifecycle. Insurers considering how to reduce the impact of LIPS on their operations may need to look at changing the emphasis of staff training to place a greater emphasis on skill sets more traditionally associated with customer services, in order to deal with the specific challenges arising with unrepresented claimants. Insurers may also want to consider the creation of:
- A claims handling philosophy with LIPs at the core;
- Simplified and efficient claims processes accessible to LIPs;
- Guidance notes to be given to LIPs detailing;
- The methods available to the LIP to bring a claim, eg, through a solicitor, direct to insurer, etc;
- The key points in the lifecycle of the claim with realistic timescales and next steps;
- The documents that will be needed to evidence the claim;
- Signposting to the relevant protocol and injury tariff;
- Contact details for the claims handler; and
- Signposted and accessible complaints processes for LIPS.
Whilst the provision of a positive experience to a LIP will undoubtedly assist in the processing of the claim, it is important for insurers to remember that the LIP is bringing a claim against their customer and a degree of separation must remain to ensure that the interests of all parties are protected. An important point here is that care should be taken not to provide a LIP with advice on the best way to process their claim or provide them with legal advice. In our view, it would be good practice to ensure that a LIP is signposted to their right to seek independent legal advice at all key points in the lifecycle of the claim.
Can we help?
Weightmans has experience of creating LIP claims processes for compensators designed to reduce the operational impact of dealing directly with LIPs whilst ensuring that LIPs continue to achieve access to the same level of justice as they would have had they had the benefit of legal representation. We will also be keeping a watching brief on the reforms as they develop and will report back.
In the meantime, should you wish to discuss this in more detail, or would like assistance with any other matter, please do not hesitate to get in touch with any of our team:
- Bavita Rai (Partner, Innovation & Client Affairs, 0121 200 3499);
- Doug Keir (Partner, Scottish Affairs, 0141 375 0869);
- Or email our Market Affairs Group at firstname.lastname@example.org.