What now of the Government’s changes to whiplash compensation and an increase in the Small Claims Track? With the announcement of the dropping of the Prisons & Courts Bill on 20 April and an election in June that failed to award the Conservatives with an overall majority, the entire reform agenda had been plunged into doubt.
However, we now know that the Government fully intend on bringing this policy reform back to the fore. The Queen’s Speech on 21 June saw the announcement that the Government will introduce a new “Civil Liability Bill”. It was stated that:
For insurers, this is undoubtedly positive news.
The transfer of CMC regulation and changes to liability rules to accommodate autonomous vehicles were, due to cross party support, less at risk of being abandoned. However, the whiplash reforms would have been considered from a different viewpoint - there was no guarantee that we would see them again given the competing priorities that the now weakened Conservative Government are now facing. The appearance of the Civil Liability Bill is encouraging and shows that the Government are continuing to prioritise reducing the cost of living for ordinary working people.
As a recap, we outline the main provisions of what were (and perhaps may still be) the Government’s proposed changes:
The consultation also asked for views on IPT recommendations, credit hire, early notification of claims, rehabilitation, recoverability of disbursements, and the introduction of a Barème type (points based) system. The Government’s response to these were to be dealt with in a separate document – there is no clarity on when we might see this, if at all.
Both primary and secondary legislation will be required to implement these reforms. The Government previously stated that it is working towards an implementation date of 1 October 2018; it is highly doubtful that this target date will be reached given the uncertainty in the current political climate.
So what now? When can we expect to see the Bill itself?
Well, given that there is little parliamentary time before October (less than a month before summer recess, and less than two weeks after recess but before conference season), it is difficult to see much progress being made on this Bill within the next few months. From the Government’s perspective, it would seem sensible to delay the introduction of this Bill until the Autumn, when Parliament is back in session for a decent length of time to allow full and proper debate on the issues. This won’t be until 9th or 10th of October.
Although this extended delay may be frustrating, this provides opportunities for the insurance industry in terms of dedicated lobbying of MPs, peers, and MoJ officials. It is vital to stress the importance of the wording of the definition of “whiplash” – an issue that the industry was at pains to try to correct after seeing the deficient wording contained within the Prisons & Courts Bill. This delay will hopefully ensure that the Ministry of Justice gets it right the first time around so that these reforms can go as far as possible to achieve the stated “£35 a year” saving on motor insurance premiums.
The service you deliver is integral to the success of your business. With the right technology, we can help you to heighten your customer experience, improve underwriting performance, and streamline processes.
