Justice secretary Chris Grayling will today unveil his long-expected blueprint for bringing down the number of whiplash claims.
In a four-month consultation to be launched this morning, Grayling (pictured) will outline proposals for independent medical panels to diagnose whiplash injuries and raise the small-claims track threshold from £1,000 to £5,000.
The consultation paper acknowledges the argument that changes will harm access to justice and could mean victims with justified claims would either not challenge unreasonable offers by insurers or fail to claim proper damages for their injuries.
But the Ministry of Justice insists the reforms will make it less likely that fraudulent or exaggerated claims will be made, and if they are then they can be properly tested. Grayling said: ‘For too long honest drivers have been bearing the price of a system that has been open to abuse and it is time for that to change.
‘We are proposing action to support effective whiplash diagnosis by medical experts and to simplify procedures which will help bring speculative or fraudulent claims before a judge – so genuine claims can still be settled but fraudsters are left in no doubt there will be no more easy paydays.’
Reforms have been expected since an announcement in the summer by the MoJ that it wanted to reduce the number of whiplash claims, which followed summit meetings with the insurance industry at Downing Street in February.
Current whiplash diagnosis arrangements involve patients going to either their GP or a doctor employed by an organisation recommended by the claimant law firm, with the medical expert paid a standard £195 fee. The MoJ says that independence would help address concerns raised about the diagnosis of whiplash injuries.
The two proposed options are for either an accreditation scheme run by a separate organisation or a private contractor that would assess whiplash claims and supply reports using a standard form. An independent board made up of insurers, claimant lawyers and representatives from the court service would select the contractor.
The changes to the small claims procedure are likely to be more controversial amongst the claimant sector. A consultation in April 2007 found no reason to increase the threshold from £1,000, and Sir Rupert Jackson came to the same conclusion in his 2009 review of civil litigation costs.
The government says it believes many small-value whiplash claims are relatively straightforward and that the small-claims track is the most suitable venue for them – a move which would largely eliminate solicitors from dealing with any claims of less than £5,000.
The consultation proposes three options: increase the threshold for RTA whiplash claims to £5,000; increase the threshold for all RTA personal injury claims (including whiplash) to £5,000 or retain the current threshold.
The paper adds that the small-claims track is a ‘less costly regime in which to bring a case and therefore a less costly one in which to challenge questionable whiplash injuries’.
The consultation closes on 8 March, just 14 working days before the Jackson reforms – including reform of no-win, no-fee and the ban on referral fees in PI – are set to be implemented.
That date is also likely to see a 60% reduction in fixed recoverable costs for low-value RTA claims going through the electronic portal and the portal extended for claims up to £25,000 and employer and public liability claims.