Tackling the cost of whiplash claims

A recent Government consultation proposes raising the limit for personal injury claims - including whiplash - to £5,000. 

Smaller claims would be dealt with in the small claims track where claimants would have to represent themselves, as their legal costs would not be recoverable.  The objective is to save insurers money and tackle the perceived problem of fraudulent whiplash claims.  Insurers say they could reduce premiums as a result.  The consultation closed in March 2013.

Claimant lawyers are concerned that these proposals could create an inequality of bargaining power, where ordinary members of the public have to face insurance companies that can afford to use legal representation.  Research by the Association of Personal Injury Lawyers shows that on average whiplash case litigants without legal representation received around £1,000.  When a solicitor was involved, average damages tripled to an average of £3,173. 

The House of Commons Transport Select Committee has just published findings from its enquiry into motor insurance costs.  They commented, “We believe that access to justice is likely to be impaired, particularly for people who do not feel confident to represent themselves in what will seem to be a complex and intimidating process.  Insurers will use legal professionals to contest claims, which will add to this problem.”  Information provided by the Government shows whiplash claims falling since 2010-2011; they are now lower than any time since 2007-2008. 

The Select Committee supported proposals to improve medical reports accompanying whiplash claims by the use of an independent expert and suggested that claimants provide more information in support of their claim, such as proof that they saw a doctor shortly after their accident.

The Ministry of Justice said it would consider the views of the Select Committee and is likely to respond to the consultation in the autumn.