Keoghs Insight


Samantha Ramen

Samantha Ramen


T:07713 393534

Market update - The Civil Liability Bill becomes an Act

Let's Talk Shop

The Civil Liability Act finally received Royal Assent just before Christmas. This confirms the framework for the whiplash reforms, changes the process for a regular review of the personal injury discount rate, and starts the clock ticking on the first review of the rate. So what now?

Whiplash reforms

There is a lot that needs to be done to implement these reforms before April 2020 (the Government’s target implementation date).

In summary, these are:

  • Accompanying regulations to the Act (these clarify various issues but most significantly set out the level of the damages tariff for whiplash claims as defined in the Bill);
  • Changes to the Civil Procedure Rules to increase the small claims track limit to £5,000 for motor claims; and
  • The launch of a Litigant in Person (LiP) Portal, which will be a separate IT build to the current RTA/EL/PL portal.

Work is ongoing on these matters; the Government and the MIB (who are heavily involved in the LiP Portal) are confident that these reforms will be up and running by April 2020.

Whilst they are limited to motor at present, if previous experience is an indicator, we should expect that these reforms will be extended to EL/PL claims at some point in the this space!

Discount Rate

The Act prescribes changes to the process of the setting of the discount rate, both for the first review (as set out below) and for subsequent reviews (these will involve an expert panel and will take place at least once every five years).

We have set out the process for the more immediate issue of the first review below:

Initial review of the rate

The time periods in relation to the first review are:

  • 90 days to commence the review
  • 140 days to complete
  • The Lord Chancellor must consult the Government Actuary and the Treasury:
    • The Government Actuary must be consulted within 20 days of the start of the 140 day period; and
    • Must respond 80 days after the consultation request.

Timings of the first review

  • The review will commence by 20 March 2019
  • The Government Actuary Department will be consulted by 9 April 2019
  • The Government Actuary Department will respond 28 June 2019
  • The Review will be complete by 7 August 2019

Remember – these are maximum timescales (the Government has its own incentive to expedite this because of the cost to the public purse.

This process will run alongside the current Call for Evidence on the discount rate issued by the Ministry of Justice.

Keoghs will be responding to the Call for Evidence and will make sure to provide clients with a copy of the draft submission in advance of the 30 January deadline.

The Keoghs Market Affairs Team will continue to stay close to the implementation of this legislation and will engage at all levels and with like-minded stakeholders to ensure that the insurance voice is heard by Government throughout this process.