The Civil Liability Act 2018 – ‘The Whiplash Reforms’ Update: 28th March 2019

 

The Civil Liability Bill received royal assent on 20th December 20018 becoming the Civil Liability Act 2018. This brought into legislation the mechanism for reforms to claims for whiplash injuries. For accidents occurring after the reforms are implemented, damages for whiplash injuries lasting up to two years will be set by a tariff proposed by the Lord Chancellor, which is yet to be decided. The tariff is expected to include claims for minor psychological injury but excludes more severe symptoms of psychological illness such as Post Traumatic Stress Disorder.

It is important to note that the reforms will not affect claims for whiplash injuries made by motorcyclists, cyclists or pedestrians and any other road user who are not using a mechanically propelled motor vehicle. The Act makes clear that settlement of whiplash claims before a medical report are banned.

So what is a whiplash injury? A whiplash injury is defined as an injury of soft tissue nature to the neck, back and shoulders that is, a sprain, strain, tear, rapture or less damage of the muscle, tendon or ligament in the neck, back or shoulders, or an injury of soft tissue associated with a muscle, tendon or ligament in the neck, back or shoulders. This does not include however, a soft tissue injury which is part of or connected with another injury. The definition of course may change however, the Lord Chancellor cannot review or amend the definition until three years have elapsed since the date the reforms come into force.

There is likely to be a portal system designed with Litigations in Person in mind which will be both simple and user friendly. The Government expect that the reforms will come into force in April 2020 and will not come into force until a fully operative infrastructure is confirmed, including a portal system.

The main purpose of the Act is to save money and reduce the average motorists’ annual premiums charged by the motor insurance companies. The Treasury is likely to require motor insurers to report to the Financial Conduct Authority (FCA) with information regarding the impact of savings on annual premiums passed on to their customers. By the end of 2014 the Treasury are expected to report their findings to Government of the savings passed on to motorists in annual premiums.

The exact way in which the reforms will be implemented and what specific provisions will apply are yet to be confirmed and these are subject to change. For now, what we can say is that the reforms will likely lead to a dip in claims being made for whiplash injury; those claims that are presented will be tariffed against lesser awards of compensation. We are also likely to see less involvement from Claimant Solicitors and more from accident management companies assisting Litigants in Person(s) through an online portal process and taking a cut of the award of damages in a Damages Based Agreement (DBA) rather than the Conditional ‘No Win No Fee’ Agreements (CFA) commonly entered with personal injury Solicitors.

 

DATED 28TH MARCH 2019

 

Luis Dignan

Litigation Case Handler

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