Personal Injury Claims Consultation – Q&A
The Government has recently held a consultation on its plans to radically change personal injury claims.
For those who are not aware, which I think is the majority of the public, the Government plans to do two things:
- Ban whiplash claims altogether; and
- Ban legal fees for injuries valued less than £5,000
Many in the legal profession, on both claimant and defendant sides, have been left stunned by these proposals, which George Osborne unexpectedly announced in the Autumn 2015 statement.
A number of questions are being asked of the Government including:
- Who is pushing for these reforms i.e. who is really behind this and who will benefit the most?
There are certainly small sections of the public who call for a complete ban on whiplash claims. In my experience these tend to be a minority of people and their views quickly change if they are unfortunate enough to experience whiplash themselves.
For those who never experience whiplash it is understandably hard to accept. Unlike broken bones it does not show up on scans and so the evidence must come from the injured person. Contrary to the impression given by tabloid newspapers and insurance companies (who pay compensation from premiums) the medical science behind whiplash is 100% solid and no respected doctor would ever argue it does not exist. Further, doctors use a scientifically validated assessment system to work out if the whiplash is genuine and of what severity.
That said, even if a small proportion of the public would like to see a ban, why would a Government elected by the majority of the population take action in favour of the minority? Where are the polling results to support the idea the public wants this?
The simple answer, in my view, is that this has very little to do with public opinion and is in fact driven by extremely well funded political lobby groups such as the Association of British Insurers (the ABI).
Insurance companies stand to gain a tremendous amount as the less they pay out from collected premiums, the greater the profits. Further, they will enjoy tremendous savings from not having to employ claims handling staff. The insurance companies have pledged to reduce premiums by around £40 but even if this does happen (in previous personal injury reforms in which insurance companies promised to reduce premiums they in fact increased) it seems rather pathetic – one can often save over £100 by using a price comparison website rather than allowing the auto-renewal process to continue.
Have the public been asked if they would rather give up an ancient British legal right or have the possibility of £40? If I was asked to choose between the possibility of £40 and allowing a dangerous precedent in the form of businesses being allowed to change laws to boost profits, I know which I would choose.
- What will happen to the public if this happens?
When it comes to road traffic accidents resulting in soft tissue injuries, injured people will be left to suffer in silence. Left unable to work and pay the bills? – tough. Need physiotherapy to recover but there is a 3 month NHS waiting list? – tough. In pain each day because another driver refused to drive safely? – tough.
When it comes to non-road traffic accident soft tissue injury claims, with a value up to £5,000 (which will include some relatively serious injuries), the fact the public will have to pay solicitors’ fees will effectively prevent such claims being brought as the fees of the case will outweigh the compensation. So, similar to people injured in car accident claims, the position will be one of tough luck.
We are therefore approaching one of the biggest changes to British legal rights ever seen. The ancient rule that the wrongdoer pays for their actions is on the verge of being displaced.
The public will suffer in other ways too. At present insurance companies have to pay the costs of private medical treatment, lost earnings and more, for injured people, thereby removing the burden from the Government. It follows that if people cannot make an insurance claim the Government, in particular the NHS, will have to bear this burden. Again, the ancient principle that the wrongdoer must pay is being pushed aside. Tens of thousands of jobs will be lost throughout the legal profession and insurance sector, thereby again increasing the burden upon the state.
- Why is this being allowed to happen? Why aren’t newspapers reporting this?
How the current Government is so easily influenced by insurance companies remains a very concerning mystery and one I believe should be the subject of an urgent independent investigation including the source of campaign donations of the MPs pressing for these changes and also the details of meetings they have partaken in with both insurance companies and lobby groups such as the ABI. In a situation in which a handful of businesses are about to receive a tremendous financial benefit whilst the public and state suffer the burden there must be a full investigation as to why this is happening.
Tabloid newspapers have long adopted an extremely venomous attitude towards injured people and the personal injury claims. Again, I believe there should be investigations into their financial support and contact with various political lobby/pressure groups as a free and honest media is crucial to enable the proper functioning of democracy.
Many in the legal profession have come forward to decry the proposed changes and have contributed to the Government’s very brief consultation period but again, for mysterious reasons, there appears no appetite on the part of tabloid newspapers to cover such views. As to whether such submissions make any difference I am sceptical.
- Where will this lead to?
I personally fear this will be a very worrying precedent. If political lobby groups can change ancient laws to boost profits then no legal right is left safe. It will probably be many years until the public appreciate the true consequences of the Government’s actions, similarly to the way the vast majority of the public do not yet realise that in 2013 the Government quietly removed the key health and safety laws protecting employees in this country (the Enterprise and Regulatory Reform Act 2013).