An earlier post in February outlined what seemed then a plausible timetable for progress towards implementation of the Autumn Statement reforms to personal injury claims. In the two months since, the EU referendum campaigns have begun to have a noticeable effect on the Government’s policy-making activity. The Times carried an article by its Whitehall editor on 8 March under the headline “Policies shackled by EU vote ‘lockdown’” which reported that policies had already been postponed and “difficult decisions ducked” as Ministers looked to the referendum.
Although there is nothing is official, it does now look more likely that a consultation paper on the Autumn Statement reforms will not appear until some time after the referendum on 23 June. Despite this likely delay, questions in Parliament earlier this week should serve to reinforce the view that the necessary measures will be taken forward by this Government in due course.
On Tuesday 26 April, Justice Minister Dominic Raab MP dealt with oral questions from MPs on various MoJ matters, during which he referred three times to the consultation to come. Part of his remarks is set out below.
The Government remain concerned about the number and cost of whiplash claims, and in particular the risk that unmeritorious claims push up the cost of insurance for customers. New proposals have been announced. We will consult on them in due course, and they will be accompanied by an impact assessment … The Chancellor has already announced proposals to remove the right to claim damages for pain and suffering for very minor claim [sic] and to increase the small claims limit to £5,000. That is important, as it will help us cut the cost of resolving cases. As I said, we will consult on the reforms, but, critically, they will save the insurance industry £1 billion annually. The industry is committed to passing those savings on to customers, which will reduce premiums by £50.
Later in the week, on Thursday 28 April, Transport Minister Andrew Jones replied to a written question about motor insurance and also referred to the proposals for reform and to other factors that may affect insurance premiums.
The Autumn Statement 2015 announced the government will bring forward measures to reduce the excessive costs arising from unnecessary whiplash claims. As the industry is competitive we expect average savings of £40 to £50 per motor insurance policy to be passed onto customers. Some insurers have already committed to pass on all savings to consumers as a result of the proposed changes. The Department for Transport has also held a number of recent meetings with the motor insurance industry, for example to discuss young driver safety and technology measures which can reduce the cost of insurance.
Next week, Justice Minister Lord Faulks QC has been invited to deliver a key note address to the annual conference of the Association of Personal Injury Lawyers, which takes place on 5 & 6 May. According to the event’s programme, he “will speak about the Government’s civil justice reforms.” It seems reasonably likely he will stick to fairly general comments of the type made above by his Ministerial colleagues, but should he make any notable points in his speech we shall report those via this blog.
About the Author
Alistair Kinley is BLM’s Director of Policy & Government Affairs.
Alistair is responsible for BLM’s engagement with government departments and regulators on policy and public affairs issues and consultations affecting the firm and its customers. He coordinated BLM’s market-facing activities in connection with the Insurance Act 2015 and the consultations which preceded its publication and introduction in Parliament.
He is a member of the Civil Justice Council (CJC), a regular speaker and experienced commentator on legal and procedural reforms and was a contributing editor to the Law Society’s Litigation Funding Handbook (September 2014).