The government has confirmed it will raise the small claims limit for whiplash injury to £5,000, but will impose a lower threshold of £2,000 for other personal injury claims. There will also be a ban on any offers to settle personal injury claims without medical evidence.
The new fixed tariffs are contained in the Prison and Courts Bill published on 23 February.
Announcing the new legilsation, Justice Secretary Elizabeth Truss said the measures will help to cut down on the compensation culture epidemic. The bill follows a period of consultation which ended on 06 January. The small claims limits mean that successful claimants up to those thresholds will not be able to recoup legal expenses, effectively excluding lawyers from low value claims. The measures are a retreat from the government's original plan to increase the limit to £5,000 across the board.
The Association of British Insurers direct of general insurance policy, James Dalton, welcomed the bill, saying "the reforms to whiplash claims set out in the bill cannot come soon enough" and "motorists know that the UK's roads have been getting ever safer, so why have whiplash style claims been rising? People want an insurance claims system that provides compensation and support to those who genuinely need it. What they don't want is to be plagued by spam calls and texts from ambulance chasers, whilst personal injury lawyers continue to profit from a broken system in urgent need of reform.
In contrast, lobby group Access to Justice criticised the bill, with their spokesman saying "The government seems hell bent on removing the rights of ordinary people to gain redress for injuries that weren't their fault".