I am sure by now if you are reading this you are aware that there are set to be a whole number of changes to the way personal injury claims are handled as part of reforms being brought in by the government post 1st of April.
What you may not know is how do they all actually affect the genuine accident victim in the long run and what they should be prepared for.
Well to summarise the changes that are now afoot, despite a lack of detail and numerous protests and attempts to stop them, the government have decided to bring in wholesale reforms to the way in which personal injury claims are dealt with. These changes will effectively mean that accident injury claimant’s could be worse off by not receiving 100% compensation and post-1st April, no win no fee claims for personal injury may be stopped altogether.
So what are the changes that the government are proposing?
- Increasing the small claims limit
- Extension and reduction of fixed costs
- Success fees no longer payable by the Defendant.
Now I know what you are thinking, what do these mean and how do these reforms affect the claimant?
Increasing the small claims limit
As it stands at the moment the small claims limit is currently £1,000. This means that when a claim is successful the opponent’s insurance company must pay solicitors costs for claims worth more than £1,000. After April, if government proposals are pushed through, the claims limit will rise to £5,000 which will then mean that the insurance company will only have to pay costs of over £5,000. The problem here is that with it being the small claims court, most of the cases that run through it do not scale up to this price, which will therefore mean that the claimant will have to pay for their legal costs for any claim that comes in less than this costs, therefore they will not be receiving 100% compensation.
Extension and reduction of fixed costs
Under the current legislation, low value road traffic accidents (RTA) are currently dealt with under a fixed costs scheme. From the 1st April the scheme will be extended to cover the majority of accidents including those of a higher value. Alongside this the costs payable for each case will be significantly cut which means it is almost certain to affect the way personal injury firms are able to operate and as such the level of service and quality will decrease and in a lot of cases become extinct leaving the accident victim to fight for themselves against the insurance companies and their lawyers. This will in turn lead to the claimant being defeated in the courts and receiving little, to nothing for their personal injury claim or to avoid this they will have to agree to a smaller counter offer from the defendant’s insurance companies. Either way the claimant’s right to justice is removed and in most cases they will be left out of pocket.
Defendant no longer has to pay success fees
Under the no-win-no-fee scheme that personal injury specialists like ourselves offer, the claimant is assured that they would always receive 100% of the compensation they are awarded as we the solicitors would claim our success fees from the defendant’s insurance company.
Under the government’s proposed reforms for April the defendant will no longer be required to pay these success fees and the claimant will now have to. This means the victim is no longer receiving 100% compensation and therefore effectively is contributing towards the costs of somebody else’s claim.
All in all these changes have an extremely negative effect on the genuine accident victim post 1st of April. At the end of the day, accidents can, do and will happen and as a result they often cause financial hardship. This is why the ability to claim for compensation is available to genuine victims, in order to make sure that they can get back to the same position they were in before they had the accident with as little inconvenience as necessary
After the reforms are brought in on the 1st April, this can no longer be guaranteed.
Please note that if you have already started your claim with us then you are protected from the impact of the potential changes and your claim will not be affected.