In 2020, the Civil Liability Act 2018 will come into force, having received Royal Assent and become law in December 2018.
Insurers argue that this is an Act designed to reduce the number of so-called “fraudulent” whiplash claims. Claims arising out of road traffic accidents (“RTA’s”) and thus, they say, will reduce the average car insurance policy by about £35 per year. Please note this figure seems to be a bit of a moveable feast – it was £84 at one point
Of course, what you may also notice is that your insurance policy premium will have gone up anyway, due to any number of reasons, such as the month you renew having an R in it. I’m sure you’ve all been told that it is because more and more people are making personal injury claims (this is also what the press have been saying for a number of years), when in actual fact, the statistics on claim numbers for Road Traffic Accidents (RTA’s), show a large decrease in the number of claims. For example, Government figures confirm that since 2011/12 RTA’s have fallen by 22%, or 178,000. This fall in claims also applies across all other claim types as well. Again contrary to what the press and the insurance industry tell us. Since 2011/12, all personal injury claim numbers have fallen by 18%.
So insurers could merely raise the cost of the policy announcing a “reduction”. Which then isn’t really. Standard selling technique to make the buyer thinking they’re getting a better deal than they are. We’ve all seen the sofa adverts!
What the Civil Liability Act 2018 will do (from April 2020) is increase the Small Claims limit for claims arising out of RTA’s to £5000.00 and other types of claim, such as workplace accidents, to £2000.00. The previous limit for both was £1000.00.
What this means until April 2020 is that as long as you have an injury that was “worth” £1000.00 in terms of compensation for your injury, you could make a claim with the assistance of legal representation should you wish to do so, as the lawyer acting for you would get paid for the amount of legal work they did for you in relation to your claim.
In putting their (considerable) financial weight behind this new law, the insurers also say they also want to control the costs of litigation in these claims, which they say often outweigh the actual compensation the Claimant receives in the end, therefore only the lawyers “win”. What they fail to mention is that costs are already controlled by lawyers only being able to claim “fixed costs” – costs for which the figure is set by law – in smaller claims with values up to £25000.00. Not a “small” sum to many people on say, minimum wage who have lost even that by being injured in an accident and out of work.
But what the Civil Liability Act will mean in practical terms is this:
From April 2020, if you are injured due to someone else’s fault in an RTA or a workplace accident or fall, say, you will still be able to make a claim. BUT you will not be able to do so without paying for legal assistance from a specialist lawyer.
This is because lawyers will not be able to claim any legal costs for acting on your behalf if your injuries are not serious enough to be likely to attract compensation of £5000.00 at least for RTA’s and £2000.00 for other accidents. This is a statement which is bound to attract those who consider lawyers to be overpaid anyway to say, “Well, good! About time we cut lawyers costs”.