The Road Ahead for Whiplash Claims

The government announced its Queen’s Speech last Wednesday. Many expected the government’s legislative agenda to deal mainly with Brexit and the untangling of over 40 years’ worth of European Law from our own legal system. However, despite the fact that the Prime Minister now leads a minority government which faces uncertainty as to whether it will be able to pass any legislation at all, the Queen’s Speech also included measures proposed to reduce whiplash claims.

Insurers have been lobbying the government hard to tackle whiplash claims and, assisted by the media, have spread the fiction of a ‘compensation culture’ existing. Unfortunately, despite all studies showing that such a compensation culture is largely a figment of insurer’s imagination, the government appears to have bought into this fiction. What this means is that the government has now proposed a Civil Liability Bill which will likely introduce a tariff system for whiplash claims.

At present whiplash claims are valued like any other injury, taking into account the pain, suffering and loss of amenities suffered by the individual, together with the length of time the symptoms persist. Cases are valued by considering previous court cases where the claimant has had similar injuries and looking at what the court has awarded on those occasions. The government’s proposals plan to do away with this tried and tested system and to instead introduce a ‘tariff’ system where whiplash claimants will receive a set amount, depending on how long their symptoms last.

The tariff system will not take into account how severe the symptoms were or how much the individual suffered and will only take into account how long the symptoms persisted. What this means is that somebody with debilitating symptoms that last a year will likely receive the same as somebody with very mild symptoms that last the same amount of time. At the same time, the proposed awards under the tariff system are significantly less that what Claimants currently receive. For instance, an individual suffering whiplash that lasts 10 to 12 months can currently expect to receive an average award of £3100. The government’s proposed changes will mean that such a victim would instead receive £1,190, which is a little over 1/3 of the current award.

The changes have been tabled following a consultation process which received overwhelmingly negative responses to the government’s proposals. Despite the consensus amongst the majority of respondents that these changes were unnecessary, would do nothing to tackle fraudulent claims and would result in injured Claimants being denied adequate compensation, the government appears to have ignored all objections and seems intent to press ahead with the changes.

Insurers initially suggested that the changes could result in £50 being saved from the average premium, but have, over time, revised this estimate to say that it will likely result in a reduction of £35. However, the government has no means of actually enforcing such assurances and in previous years, insurers have promised similar reductions, only to increase premiums instead. It is therefore highly unlikely that the average motorist will find that their premium has gone down following these changes, particular because other changes made to the insurance industry will likely mean that insurers will be raising premiums in any event.

Arsalan Abbasi

Director, Liddy’s Solicitors