A local law firm has welcomed the decision announced by Ministry of Justice to review the methodology used to calculate serious personal injury claims. It has been a period of mixed messages with on one hand the government confirming an increase in the small claims limit to £5,000 for ‘RTA-related personal injury’ claims, and £2,000 for all other personal injury claims, which will impact on those suffering injuries such as whiplash; whilst on the other hand revising the personal injury discount rate which will significantly increase the figures paid out in compensation to victims in more serious cases.
In a bid to curb ‘rogue claimants’, the government has increased the small claims limit following pressure from insurers, with an indication from them that this would lead to a reduction in car insurance to the tune of around £40 per year, although law firms remained sceptical about this promise.
However, this week Justice Secretary Liz Truss announced that those affected by medical negligence, car crashes and other incidents will get more money after changes to the way lump sum payouts are calculated. In response to this, insurers are now stating that young drivers could face a rise of £1,000 per year to insure their car, with drivers over 65 being charged an additional £300, and average premiums rising by £75.00.
Steve Simpkins, Principal at Simpkins & Co Solicitors said, “We welcome the change to the personal injury discount rate, which is long overdue. It will have a significant impact on the types of client we usually represent, those often with life changing injuries who are seeking compensation to help them cope for the duration of their life. The current discount rate was set in 2001 which is no longer appropriate. The Ministry of Justice has reviewed this, and from March 2017 courts will consider payouts at this new rate and any compensation awarded should put the claimant in the same financial position had they not been injured, including taking into account loss of future earnings and care costs.”
In making the announcement Ms. Truss also acknowledged the impact this will have on the public and private sector including the NHS, and hascommitted to ensuring that the NHS Litigation Authority has appropriate funding to cover changes to hospitals’ clinical negligence costs.
Simpkins and Co Solicitors, with offices in Highcliffe and London represents those making major personal injury and medical negligence claims and supports these legal reviews. Mr. Simpkins added, “The Association of Personal Injury Lawyers (APIL) has been fighting for many years on behalf of claimants and were prepared to take it to judicial review. These changes will mean that victims of serious personal injury or medical negligence will be properly compensated to enable them to manage their lives going forward. The down side on small claims limits is that we could see a rise in cases taken on by claims management companies who adopt more aggressive and ruthless marketing tactics than bona fide law firms. Ironically, this could lead to increased complaints about cold calling and ‘no win no fee’ selling. In many instances those suffering minor injury will not be able to afford proper legal representation.”
The changes to the injury discount rate for serious cases comes into effect in March 2017, whilst the proposed changes to the small claims limit is planned for 2018.
Simpkins and Co offers a free initial consultation for anyone requiring guidance on personal injury or clinical negligence matters. They can be contacted on 01425 275555 or via their website www.simpkinsand.co.uk.
Julie-Anne Houldey
