At First4Lawyers, we previously warned claimant lawyers “not to get the bunting out quite yet” after the snap general election saw the Prisons and Courts Bill shelved as we all knew that if the Conservatives formed the next government, there was every chance that the personal injury (PI) reforms contained in the Bill would be revived.
It was therefore disappointing, although not entirely surprising, when on 21st June we had confirmation in the Queen’s Speech that the Government did intend to press ahead with personal injury reform in the guise of a new Civil Liability Bill.
Although, as yet, details are lacking we do know that the proposed purpose of the Bill is to “ensure there is a fair, transparent and proportionate system of compensation in place for damages paid to genuinely injured personal injury claimants”. Which, on the face of it, is perfectly reasonable and wouldn’t meet with disagreement.
However, the motivation for doing so had a predictable tone, with the Government claiming the proposed legislation would tackle “the continuing high number and cost of whiplash claims to put money back in the pockets of motorists through reduced insurance costs”, with the main focus being to “tackle the rampant compensation culture and reduce the number and cost of whiplash claims by banning offers to settle claims without the support of medical evidence and introducing a new fixed tariff of compensation for whiplash injuries with a duration of up to two years”.
The promised saving of £35 a year for motorists is, as we all know, at best fanciful and at worst, incredibly misleading as there is no way of monitoring and enforcing it. The initial consultations about these proposals recognised that even the Ministry of Justice doesn’t expect insurers to pass on all the savings. Besides, the introduction of the increased Insurance Premium Tax (IPT) will put a stop to any hope consumers had of actually seeing their insurance bills cut.
I have a better idea for passing on £35 to every motorist: When it comes to renewal time the industry could cease their annual premium hike charade designed to get time poor individuals to stump up more cash and instead just give the real price.
While it was only right that PI reform forms a standalone bill, rather than being tacked onto other legislation that takes most of the attention, any legislation should look in more depth at the entire claims industry and put as much scrutiny on insurers as it does on those making a claim.
At First4Lawyers, we are undeterred and will continue to fight any proposals which inhibit innocent injury victims from accessing justice and call on the new justice secretary, David Lidington, to facilitate a meaningful and honest debate about what is right and wrong about how personal injury victims are treated, the way in which insurers operate and the importance of the whole sector coming together to stamp out fraud.
One piece of welcome news in the Queen’s Speech however, was the new Financial Guidance and Claims Bill, although largely expected, we certainly welcome tighter regulation of claims management companies (CMCs), we’ve been calling for it over many years.
The Financial Conduct Authority has a proven track record for dealing with financially-related firms and I suspect it may have stronger regulative powers than the current regulators. However, we really would like to see more distinction made between the regulation of financial services CMCs and non-financial services CMCs as this will help all on the road to improved regulation of the sector.
Only four per cent of complaints about CMCs relate to PI, so it is a missed opportunity to better regulate bad practice by lumping the good, the bad and the ugly all into one.
This article first appeared in Claims Magazine.