Insurers have welcomed the progression of hotly anticipated personal injury reforms through Parliament, however yesterday’s events in Westminster have whipped up fresh disapproval from the legal sector.
The insurance industry has welcomed the progression of the Civil Liabilities Bill through the House of Commons on Tuesday.
Martin Milliner, claims director at LV, said: “We’re pleased that yesterday’s debate in the Commons largely signals a full steam ahead approach for the Civil Liability Bill.”
“While personal injury lawyers continue to bemoan the fact that the proposed legislation is unfair to customers, the reality is that it couldn’t be further from the truth. This legislation has been designed to help customers and they should be pleased that action is being taken to help reduce household insurance bills.”
The Bill comprises both changes to how whiplash claims are paid and how the discount rate is set.
The reforms will also see a reduced tariff for fixed for road traffic accident claims, and a new £5,000 small claims limit. However, some claimant lawyers argue that the reforms may restrict access to justice for claimants.
Commenting on last night’s Reading, Rob Cummings, head of motor and liability at the Association of British Insurers said: “There was significant support for the Civil Liability Bill in the Commons last night. It was good to hear MPs urging reform of the broken personal injury compensation system in the interests of customers and taxpayers more widely.
“The Secretary of State David Gauke was right to emphasise the strong commitment from insurers that the cost benefits as a result of the Bill will be passed on to customers. We will continue to engage with those who have raised concerns about the Bill to explain why we think it’s the right way forward.”
Criticism of the Bill
As MPs gathered for the Second Reading of the Bill in the House of Commons yesterday, personal injury lawyers made a last-ditch effort to urge ministers to rethink the controversial whiplash reforms.
Laurence Besemer, CEO of the Forum of Insurance Lawyers said that any weakening of the proposals, particularly around the definition and the tariff, “will seriously affect the potential for the Bill to reduce claims and costs and deliver the savings to policyholders which the government is seeking.”
Despite welcoming the previously announced delay to the reforms, critics of the bill expressed fresh concern following yesterday’s reading.
Andrew Twambley, spokesperson for Access to Justice, said last night’s debate made it clear that the government has got its priorities wrong.
“It has been hoodwinked by insurers and is not standing up for the rights of injured people,” he said. “Some reform is necessary, but the government’s current proposals tip the balance too far in favour of insurance companies. It’s not too late for ministers to make changes to their proposals to deliver a balanced package that safeguards the rights of injured people.”
Twambly added: “The government has run out of arguments to justify these punitive reforms that penalise injured people and hand £600m back to insurance companies.
“MPs made it clear that if this Bill becomes law, chaos and confusion will follow, because the same injury will have wide variances in compensation, depending on whether it took place at work or not. Claims touts and cold callers will be laughing all the way to the bank.”
“The proposed changes mean that people will get more compensation for a delayed train than they would for an injury in a road traffic accident that wasn’t their fault.”
‘Anomalies’ need addressing
Shirley Woolham, CEO of claimant law firm Minster Law, said she was pleased to see government has listened to concerns over the threat to vulnerable road users and is proposing to remove them from the scope of the personal injury reforms.
“However, their removal will create further anomalies in injury compensation payments, so that people suffering the same injuries in accidents that weren’t their fault, for example a broken leg, will get different treatment by the justice system depending on their mode of transport,” Woolham said.
“It is bizarre that, whether the injured person is in a car, or a motorcycle, or riding a bicycle, will become a more important factor in deciding access to justice than the injury itself.”
“I hope the government will address these inconsistencies by ensuring a level playing field for all non-fault injuries and make sure all our citizens have their access to justice protected.”
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