With the Alternative Dispute Resolution (ADR) scheme under the General Terms of Agreement (GTA) moving into its next phase, and the intention for ADR ultimately to become effectively mandatory for eligible disputed credit hire claims, we look at where the scheme stands and the likely timeframe for the next stages.
The scheme has been developed to provide a quicker, industry-led alternative to litigation for GTA claims that remain unresolved after 61 days. The second pilot phase began in September 2026, with outcomes being reviewed and audited as it progresses. The process applies to claims where the credit hire charges are below £10,000, with a number of exceptions.
During this stage, eligible cases can be put forward for ADR on a case-by-case basis, allowing the process to be tested across a wider range of disputes. Participation is not yet mandatory, and both parties must currently agree to use ADR.
The £10,000 threshold relates specifically to the credit hire charges, rather than the overall value of other losses. There are also exceptions for certain categories of claim, including serious injury, claim validation investigations, indemnity issues and some complex liability disputes.
Importantly, the voluntary phase is intended to be a stepping stone rather than the end state. The current expectation is that ADR will move to effectively mandatory use for eligible GTA claims from around summer 2027, although the precise timing and final arrangements are not yet set in stone.
Before then, the experience of the pilot and voluntary phase is expected to be assessed and wider consultation undertaken with GTA members. The coming months will therefore be important in determining how the final scheme will operate in practice.
The principle behind the scheme is positive. A faster, evidence-based and rules-driven mechanism has the potential to resolve disputes earlier and reduce the need for litigation.
The key question now is how the process performs at greater scale. In particular, insurers will want to monitor how consistently GTA rules and exceptions are interpreted, how more complex disputes are handled, and whether ADR affects existing bilateral and protocol arrangements.
With wider implementation expected in 2027, insurers should use the voluntary phase to understand the practical and commercial implications of the new regime and prepare for ADR becoming a much more significant part of credit hire claims handling.
For more information please contact: Kaveh Rashid or Scott Croft.
Designed to elevate the policyholder experience and empower handlers, ClaimPilot transforms the claims journey with state-of-the-art AI, streamlined processes and reduced operational bottlenecks – all in one powerful platform.
