Personal injury

The government plans to introduce changes to the personal injury claims process. The changes will affect the amount of compensation claimants receive and include:

  • tariffs for some whiplash injuries from road traffic accidents, in response to a rise in fraudulent claims
  • the small claims limit increasing from £1,000 to £5,000 for road traffic accidents not including pedestrians, cyclists, motorcyclists and horse riders, and from £1,000 to £2,000 for other claims
  • a new personal injury discount rate plus regular rate reviews, with an expert panel advising the lord chancellor

The changes to the discount rate were introduced in July 2019.

The changes to whiplash claims and the increase in the small claims limit were originally planned for April 2020. In February 2020, the government announced that it would delay this to 1 August 2020.

Following the COVID-19 pandemic, the government announced in a ministerial statement in April 2020 that the reforms will be pushed back further to April 2021. 

In January 2021, the government made a further announcement in a ministerial statement that the reforms would be delayed again to May 2021.

The delay is to allow more time to prepare for the changes, including putting in place changes to the Civil Procedure Rules.

The whiplash tariffs and personal injury discount rate changes are part of the Civil Liability Act 2018. New regulations giving full details will follow.

The small claims limit will increase at the same time. Claimants will in future be able to make their claim directly with insurers through an online portal.

Our view

The small claims limit increase, along with new tariffs, will lead to more cases being processed as small claims. Claimants will in most cases have to pay their own legal costs, even if successful. For many the only option may be to represent themselves.

We’re concerned these changes are being introduced through regulations and will not receive full parliamentary scrutiny.

We are in regular correspondence with the Ministry of Justice on this issue.

Whiplash injuries

We oppose:

  • tariffs for whiplash injuries – cause of injury should not influence the amount of compensation
  • low tariffs that will not adequately compensate people with whiplash injuries

We support:

  • the insurers’ report to parliament, explaining savings have been passed to motorists, but this should come sooner than 2025
  • a ban on offers from insurers before medical examination

We suggest:

  • the government tackles whiplash fraud instead of introducing reforms that affect legitimate claims
  • judges are able to increase compensation in exceptional circumstances
  • the government and medical experts create definitions of ‘whiplash’ and ‘psychological injury’
  • the government clarifies clauses in the act about reasonable steps to mitigate injury
  • banning insurance offers before medical examination for all personal injury claims

Small claims limit

We oppose:

  • preventing road traffic accident victims with small claims recovering their legal costs

We support:

  • proposals to restrict increases to the whiplash small claims limit by linking them to inflation

Personal injury discount rate

We oppose:

  • the lord chancellor setting the new rate based only on the Government Actuary Department report, without advice from an expert panel

We support:

  • regular personal injury discount rate review, to reflect variable interest rates
  • the lord chancellor taking advice from an expert panel when reviewing the rate in future

We suggest:

  • an independent expert panel sets the rate without the lord chancellor’s involvement
  • government commissions more research to justify changes to the discount rate, particularly on how claimants invest their damages

What this means for solicitors

More personal injury cases will be treated as small claims. Many claimants may decide not to be represented by a solicitor, as they will not be able to recover their costs.

What we're doing

The government announced that it would delay the implementation of the changes to whiplash claims until 1 August 2020. We continued to highlight our concerns about the impact of the proposals on access to justice, and have written to the new minister. The implementation was then further delayed to April 2021 due to the coronavirus (COVID-19) pandemic.

The Civil Liability Act 2018 was passed on 20 December 2018. Full details will be set out in regulations. The reforms were expected to be introduced in April 2020.

We welcomed changes to the Civil Liability Bill that address some of our concerns. Vulnerable road users – cyclists and pedestrians – will be excluded. Courts will be able to increase compensation decided by tariffs in exceptional circumstances.

The government responded to the Justice Select Committee report: changes will be delayed and will follow tests of the online portal. We welcomed this and asked the government to reconsider its plans to increase the small claims limit.

We welcomed a Justice Select Committee report which recommended a lower increase to the small claims limit and highlighted the technical challenges of the suggested online claims portal.

We campaigned against the government’s Civil Liability Bill on whiplash claims reform and personal injury discount rate application because it will reduce fair compensation.

We responded to the Justice Select Committee inquiry into the personal injury small claims limit. We highlighted concerns that unrepresented claimants would pay upfront if reforms proceed.

We opposed the MoJ’s proposal to increase the personal injury small claims limit. It prevents claimants accessing expert legal advice to prove their case and provide medical evidence.

We responded to the MoJ’s consultation on the personal injury discount rate. We welcomed the MoJ’s new policy that includes a review of the discount rate every three years and an independent expert panel helping the lord chancellor set it.

The bill was scrapped: no time for parliamentary consideration before the general election. It intended to cap whiplash compensation and ban settlement without medical evidence. It followed concerns about rising motor insurance costs, plus the high number and cost of whiplash injury claims.

Get involved

We continue to lobby government about the increase to the personal injury small claims limit and changes to the discount rate.

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