There are significant changes being made regarding the handling of low-value Road Traffic Accident injury claims. One of the biggest challenges the insurance industry will face in 2021 is the change to the Civil Procedure Rules Concerning Whiplash Injury.
The measures being put in place, are intended to reduce insurance costs, and hopefully tackle the continuing rise in whiplash claims.
There has been the development of a new portal that will allow individuals to manage their own claim, where the injury suffered in an RTA is minor with no complications, rather than rely on legal representation
However, there is concern that there will be an increase in claims management companies filling the void left by solicitors, who will no longer see this as a profitable area for them. Also, there is a view that there will be new injury types emerging that will try to avoid the tariffs and exceed the new Small Claims Track limits.
Those with responsibility for motor claims need to be aware of the changes:
- The limit for Small Claims Track claims will increase from £1,000 to £5,000. If an individual hires legal representation to pursue their bodily injury claims below the £5,000 limit, their legal fees will not be recoverable from the compensating insurer. Minors, protected parties and any vulnerable road users will be exempt from this, as they will need assistance to pursue their claim
- An introduction of a new tariff system with fixed compensation for whiplash-type injuries with a recovery period of up to two years
- A ban on pre-medical offers; where injuries fall within the whiplash definition, there will be a ban in place no longer allowing an offer to settle claims, without appropriate medical evidence
- The Official Injury Portal (OIP) goes live; allowing individuals injured in Road Traffic Accidents occurring on or after May 31, 2021 to use the portal to pursue a bodily injury claim
- Medical Evidence; this must be obtained for whiplash injury. Insurers are responsible for these medical expert fees.
There will be liability disputes which may be a full denial of liability or partial denial. The new rules allow 30 working days for a decision on liability to be made after receipt of the Small Claims Notification Form. This is a fundamental change as insurers were allowed three months to obtain the signed statement of truth and investigate, this is now restricted to just 30 working days. This denial must be accompanied by the defendant’s version of events and Signed Statement of Truth (legal document, any false detail could result in contempt of court proceedings)
To support the evidential process, insurers must have immediate access to drivers and their passengers.
To assist this, Towergate Insurance Brokers has launched a first notification of loss app to speed up the reporting of motor collisions, ensuring the incident report goes to the policyholder, ourselves, and insurers immediately.
Towergate Insurance Brokers is a trading name of Towergate Underwriting Group Limited. Registered in England No.4043759. Registered Address: 2 Minster Court, Mincing Lane, London EC3R 7PD. Authorised and regulated by the Financial Conduct Authority