Ministry of Justice announces strategy to undertake the compensation culture that is poisonous by making it tougher to win payouts
The Ministry of Justice (MoJ) suggestions would make getting a payout considerably more demanding and, according to insurance companies, will stop the UK’s standing as the whiplash capital of the world. The suggestions are meant to stamp out a “poisonous” compensation culture that’s pushed motor premiums up, led to consumers being bombarded with pain text messages and calls, and place added pressure on the NHS.
The MoJ has proposed placing a limit on the amount individuals can claim or trashing the right to damages for mild whiplash injuries. It said the typical payout cut would be seen by limiting damages this cash just out where a medical report was supplied as evidence of harm. 850 to a maximum of £425, with from £1,
The AA said it was shocking that, of more than 800,000 small claims filed through the Ministry of Justice last year 750,000 related to whiplash claims and damages .
Before this year, Britain’s largest insurance company, Aviva, said whiplash was costing motorists £2.5bn a year, adding £93 to the typical motor insurance premium.
George Osborne in his 2015 fall statement signalled a clampdown, but last month it was reported the planned reforms were delayed or shelved. The insurance industry was so relieved to see the Ministry of Justice declare its consultation on tacking the “unacceptable scenario that was ”.
By essentially removing attorneys from the procedure in several cases another essential authority suggestion would curtail excessive legal costs. It’d do it by increasing the upper limit for all personal injury claims to be heard from £1,000 to £5,000. in the small claims court This is important because, generally, legal prices in the small claims court are unrecoverable.
Aviva has said nine out of 10 of the motoring claims it received were for between £1,000 and £5.000 each.
Nevertheless, this change will probably prompt rage in some quarters because it is going to also impact harm claims unconnected to whiplash – such as claims for workplace injuries.
Other proposed measures comprise of:
• Ban offers to settle claims without medical evidence. Medco is the body charged by the authorities with managing the creation of independent medical reports in whiplash claims.
The Ministry of Justice said the issues were fuelled by a marauding claims business that supported exaggerated, minor and phony claims. Elizabeth Truss, the justice secretary, said: “For overly long, a wild compensation culture has been used by some and seen whiplash claims as a simple payday, driving up prices for millions of law abiding motorists.”
Among the insurance companies welcoming the proposals, LV=, said its own research indicated each Briton received text messages every year and an average of 468 annoyance calls.
Not everyone welcomed the clampdown, yet. Law firm Thompsons Solicitors said: “Despite government figures revealing the variety of injury claims are down, they’ve permitted themselves to be intimidated by insurance companies into resurrecting extremely unjust strategies to remove accessibility to justice for the injured, without creating a shred of evidence to warrant them.”