Access to Justice (A2J), the claimant lawyer lobby group, has called on the Ministry of Justice (MoJ) to remember the pledge made by the Prime Minister when she took office to listen to “ordinary working people” rather than “the powerful” when considering plans to reform whiplash claims.
“We urge ministers to bear this in mind as they assess the evidence during this consultation,” said Andrew Twambley, spokesperson for A2J.
The consultation paper outlines plans drawn up by the MoJ to scrap the right to compensation, or put a cap on the amount people can claim for minor whiplash injuries. Capping compensation would see the average pay-out cut from £1,850 to a maximum amount of £425 and compensation would only be paid out if a medical report was provided as proof of injury.
“The rights of ordinary people are more important than cost savings accruing to insurers, and our research has shown that 77% of the public do not trust insurers to hand back any savings made to customers via lower car insurance premiums,” said Twambley.
“Very real concerns have been expressed by a number of organisations that, if these reforms become law, insurers will benefit at the expense of millions of ordinary people who will lose their rights of redress if they have an accident that is not their fault.”
He added that although the group welcomed the MoJ consultation, as it gave lawyer and insurers the chance to engage properly with the Government, the timescales for responses were disappointing.
The MoJ has decided to close the consultation on 6 January 2017, which, he said, effectively meant that three weeks will be lost due to the Christmas and New Year holidays.
Qamar Anwar, managing director of First4Lawyers, said that the proposals were far worse than anyone could have anticipated and that they did nothing other than benefit the insurance industry.
“We sincerely hope that there is a real consultation and that this isn’t a ‘done deal’ as the language of the announcement suggests.
“Last month it seemed that the government had put a brake on reform. We hoped that it would consider a more measured approach that put injured parties at the centre of any changes.
We were wrong. Far from reducing premiums, reforms to date have only increased insurers’ profits and there is no reason to believe that it will be any different this time. The government has no mechanism to monitor and enforce lower premiums. A ban on pre-med offers is welcome, but frankly insurers will not have to make them if the proposals are forced through in their current guise.This is simply a licence for insurers to print cash.”
Kennedys partner Ian Davies said that he expected to see a forceful response to the reforms as the consultation paper appeared to go further than was previously proposed.
“In particular, we anticipate an outcry from those who deal with injury claims outside of the whiplash space who will be affected by the proposal to increase the small claims limit for all personal injury claims,” he said.
Meanwhile, Nigel Teasdale, the President of the Forum of Insurance Lawyers (FOIL), said that the consultation was a great opportunity for “significant reform”.
“We need to focus on getting the detail right to deliver a workable, effective new process,” he said.
“Several other consultations are in train or pending and this offers a real opportunity for a joined-up approach by the MOJ and other interested parties to achieve comprehensive, cohesive reform.”