The Transport Committee launched a new inquiry into whiplash claims on 15 March 2013. This comes as the Ministry of Justice’s consultation on “Reducing the Number and Cost of Whiplash Claims” ended on 8 March.
The Committee is calling for evidence on reducing the number and costs of whiplash claims.
The Chair of the committee, Louise Ellman has said “It is vitally important for policy makers to understand the reasons for the very high costs of motor insurance, especially for young drivers and to take steps to bring that cost down. Whiplash claims undoubtedly play a part in driving up the cost of motor insurance, but access to justice for injured people must be preserved.”
The Transport Committee is expecting to receive written evidence on the following points in particular:-
- Whether the Government is correct in describing Great Britain as the “whiplash capital of the world”.
- Whether it is correct to say that the costs of whiplash claims add £90 to the average premium and, if so, what proportion of this additional cost is due to “exaggerated, misrepresented or fabricated” claims?
- Whether the proposals put forward by the Government, in relation to medical evidence of whiplash and incentives to challenge fraudulent or exaggerated claims, are likely to reduce motor insurance premiums and, if so, to what extent.
- The likely impact of the proposals on access to justice for claimants who are genuinely injured.
- Whether there are other steps which the Government should be taking to reduce the cost of motor insurance.
The written submissions are to be received by Monday 15 April.
The recent MOJ’s consultation on reducing the number and costs of whiplash claims considered the creation of independent medical panels to support better diagnosis of whiplash injuries. In addition, it looked at whether the small claim track threshold for damages should be raised.
The proposals for raising the small claims level for personal injury up from £1,000 to £5,000 would see many claimants left vulnerable and unrepresented against large insurance companies. These claimants would not be entitled to recover any solicitors’ fees for dealing with their claims and would therefore have no alternative but to act on their own. This would most probably lead to many claimants choosing not to make claims because they are daunted by the prospects of taking on the experienced insurance companies and to the under–settling of claims which are brought due to the claimants’ lack of experience of the legal process.
The Government are due to provide their response to the MOJ’s consultation by summer 2013 and it is hoped that, if the government is joined-up in its thinking, then the results of this new whiplash inquiry will also be taken into account.