Kenneth Clarke outline plans to allow personal injury claims online. Under the same proposals, those seeking a compensation claim would need to try mediation before applying to court.
It was part of a series of measure designed to free up our courts and speed up compensation claims, while also lowering the rising cost to insurers and their customers.
According to researchers, the average legal cost of a compensation claims is now 142% of the award, up from 56% in 1999. The average award has also increased by 33% and the fees themselves are up almost 300%. No legal system can maintain, or justify such rises, especially in a challenging financial climate.
The changes to compensation claims proposed are to allow personal injury claims online up to a value of £50,000. This is to reduce court time, speed up resolution and control the spiralling legal fees.
There are also plans to ban convicted criminals from making compensation claims. This is a very welcome move that will save around £5 million in costs to the Treasury. It means anyone serving time will not have access to the Criminal Injuries Compensation Authority.
Well-documented claims include Ian Huntley making a compensation claim for £15,000 for injuries he sustained while in custody. These type of claims also include controversial claims in which burglars have demanded money for injuries sustained when escaping the scene of the crime. Thousands is also paid out every year to criminals who sustain injuries in prison as a result of feuds and drug-fuelled violence.
There will also be changes to the way companies represent themselves to their potential clients and how they list fees. The changes include a distance-selling type cooling off period for all contracts and a written statement of charges for each client considering a compensation claim.
The biggest change will be to remove compensation claims for less than £2,500. This is by far the most controversial change. It means anyone who suffers anything up to facial disfigurement, loss of taste or smell or a fractured skull would no longer be entitled to claim.
Thanks to the tariff system already in place for compensation claims, we know precisely who will and who will not be affected by this and those injuries form part of those who will.
This also include serving police officers, paramedics and other frontline units who put themselves at risk on our behalf. While fair in theory, the reality of these limits will hurt an already overstretched emergency service system. If nothing else, emergency services should be exempt from these cuts.
The Effect of Making a Personal Injury Claim Online
While it would be easy to wax lyrical about the political outrage some of these changes would bring, for the most part, these changes are positive.
The ability to bring a personal injury claim online will make life easier for everybody. That is as long as the website that controls it is designed and implemented properly. Making a compensation claim can be a long, drawn out process involving a lot of court time.
The ability to do most, if not all, the work online will speed things up immensely. Not only should it speed things up, it should also lower the cost of bringing a compensation claim. You shouldn’t need a solicitor to check every single entry, although you should still seek legal advice. That should bring down the cost of a claim considerably.
The Effect of Banning Criminals from Making a Compensation Claim
The net effect of removing access to the CICA for criminals serving time will be momentous. Unless those you ask know someone in prison, the overwhelming response to this proposal has been positive.
The Ian Huntley compensation claim brought this practice to light and seems to have galvanised the government into action. Nobody in their right mind wants a convicted murderer, burglar or any other criminal getting rich of their activities.
The Effect of Tidying up the Industry
The effect of the changes to how claims management companies and law firms represent themselves to their clients is another positive move. There are many fees and costs involved in bringing a compensation claim and not all of them are made clear from the outset.
The introduction of a cooling off period would be ideal for those people who find themselves feeling pressured into making a claim, or found hidden fees and charges after the fact.
Our industry is pretty well behaved for the most part, but like any industry, there are a few bad apples that give the rest of us a bad name. The harder it is for them to take us down with them the better for everybody.
The Effect of Removing the Lower Tariff for Compensation Claims
This is a controversial proposal that will hurt more genuine claimants than any of the other proposals. The effect will be many people, including our emergency services having to deal with sometimes debilitating injuries on their own.
This is not fair and seems to be more for financial expediency than anything else. Our emergency services are hard-pressed, understaffed and overworked. To remove a valuable cushion from them at a time when they could do with all the help they can get seems unfair.
While removing the lower tier of compensation claims for the general public is harsh, there should, in our opinion, be an exclusion for those doing their duty or for the good Samaritan. We are increasingly being left to defend ourselves and our properties, now an essential safety net may be being removed.
While nobody should make a spurious compensation claim, it is everyone’s right to seek redress if they suffer at the hands of another through no fault of their own. It is a cornerstone of our society that should not be cut just because it costs a lot of money.
While many of the proposals make sense, not all of them do. Removing an essential protection in order to save money seems a little short-sighted and should not pass into law.