The Access to Justice group has hailed news that the Government is set to ditch George Osborne’s plans to further reform the personal injury market as a “historic junction” in the personal injury world and a “triumph for the consumer”.
The Times is reporting that Theresa May’s new administration is “unenthusiastic” about the former Chancellor’s plans, which has led insurance industry insiders to conclude that the reforms will not happen.
Last November Osborne declared that soft tissue injury claims would not be entitled to cash compensation and that the small claims limit would be raised to £5,000. But the Government appears to have been swayed by the legal profession, which has led a concerted campaign to stop the reforms, through the Access to Justice group.
Andrew Twambley, spokesperson for the Access to Justice group, said: “We’re delighted that consumers’ rights haven’t been eroded, that the interests of profiteering shareholders have not taken to the forefront and that Mrs. May has realised that the promises made by the ABI, which were never supported by evidence or facts were hollow.
“She’s a Prime Minister for the people and not for big business.”
Twambley said that the shelving of Osborne’s proposals, which were pushed by the Association of British Insurers (ABI), would now mean that lawyers and insurers could collaborate to remove the “evils” in the industry, such as cold calling, fraud, and unnecessary claims.
“Let’s deal with those and take it forward to the Government and say, ‘we’ve sorted this out between us’ you don’t even have to think about it anymore. Then they can lock up the £5,000 issue and throw away the key because we would have dealt with the problems.
“It’s a historic junction in PI world today, a lot of work’s been done by Access to Justice, but a lot of work still needs to be done for the good of everybody, not just for the good of shareholders.”
Donna Scully, a partner at Carpenters and leading campaigner to clean up the PI sector’s image, said: “Now is the time for the whole sector to set aside its differences and work constructively together. We need to work on implementing the Fraud Task Force recommendations, make MedCo work more effectively, improve the regulation of CMCs and talk about other areas where things can be improved to support genuine customers.”
The ABI has reacted with dismay to the story, with James Dalton, director of general insurance policy at the organisation, saying that every day of delay to the proposed reforms was costing honest motorists across the UK nearly £3 million in higher premiums.
“The plans are drawn up and ready to go so there is no excuse for not pushing ahead,” he said.
“If the Ministry of Justice delivers on its promises, millions of honest customers will be better off. If they cave in to the vested interests of the ambulance chasers and cold callers, those businesses will be laughing all the way to the bank at the expense of honest motorists.”
Twambley responded by saying that the ABI needed to recognise that it had lost this battle and that it needed to collaborate with lawyers.
“It’s time for Jimmy Dalton to ring us up and say ‘come round for cake and coffee and let’s sort this out’. Because we can definitely do it.”