Insurers agree to be bound by ADR in new whiplash system


Keen: Insurers to pay for ADR and medical reports

Defendant insurers have agreed to be bound by the outcome of the alternative dispute resolution (ADR) process being built into the new whiplash system, it has emerged.

The government has also confirmed that insurers will pay for medical reports commissioned by unrepresented litigants going through the system.

We reported on Monday that the draft “customer journey” for those bringing claims through the new whiplash portal from next April provides that, where unrepresented claimants have received a full liability denial or are unhappy to accept a part-liability decision and/or what they have been offered to settle the claim, they could pursue ADR.

More detail on how this will work has been revealed in a letter from Ministry of Justice spokesman Lord Keen to Bob Neill MP, chair of the justice select committee.

He wrote: “Agreement has been reached that, regardless of the claimant’s means, for all claims where there is either full or partial liability admitted, the cost of the medical report will be paid for by the at-fault insurer.

“For those claims where liability is wholly denied by the defendant compensator, the claimant will have the ability to access the bespoke alternative dispute resolution process. This is being created to support the new service and is wholly funded by the insurance sector.

“This will provide an independent view as to whether the compensator is right to wholly deny liability.

“The insurance sector has agreed to be bound by this process, and so if the ADR outcome is that liability should be in part accepted by the compensator, then the claimant will then have their medical report paid for by that compensator at that point.”

Lord Keen said that, if the independent review process did not find that the compensator should accept liability, then the claimant could exercise their right to start court proceedings.

“At that point they would have to fund their own medical report, the cost of which would be recoverable as a disbursement should they be successful.”

He added that the Ministry of Justice would “carefully consider” the link between court fee exemption and medical report fees.

There is no detail on who will provide the ADR service.

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Reports

Our latest special report, produced in association with Temple Legal Protection, looks at the role of after-the-event (ATE) insurance in commercial litigation post-LASPO. We are at a time when insurers, solicitors, clients and litigation funders work ever more closely to create funding packages that work for all of them, with conditional fee and even damages-based agreements now part of many law firms’ armoury.

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