They represent the largest overhaul to the personal injuries legal framework in England and Wales in over a decade. Some of the main aims of the reforms are:
- Making lawyers costs proportionate
- Combating the compensation culture
- Creating an environment where claims costs savings will lower premiums
The changes that will be most apparent to consumers are:
After the Event legal expense premiums will no longer be recoverable: ATE was often the mechanism no-win no-fee solicitors used to enable them to offer such services. It was a way of underwriting their costs if litigation failed. As a result, no-win no-fee services may be offered far less.
Referral fees banned: This type of referral, where the referrer receives money will no longer be legal.
Among other changes are limits on the amount that can be claimed, particularly with regard to injuries such as whiplash.
How will these changes affect your clients?
Claimants will need to provide fast and accurate claims notifications, including:
- Notifying actual or potential claims immediately
- Ensuring information provided is accurate and complete
- Providing all relevant documentation within shorter timescales
- Providing immediate assistance with liability investigation
- Supporting quick decisions on liability
Summary
The objective of these reforms is to make claims settlements faster and a much less painful experience. Even non-claimants should benefit in the longer term as reduced fraud and extraneous legal fees produce more competitive insurance premiums.
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