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Changes to Whiplash Compensation Claims to Take Effect Oct 2018

The government has announced changes to how whiplash compensation claims will be handled and the date from which the changes will take effect – Oct 1st 2018.

Details of most of the government´s personal injury reforms were announced last week by the Ministry of Justice – including changes to how whiplash compensation claims will be handled from Oct 1st 2018. As largely expected, the threshold for claims made through the small courts has been raised to £5,000, but this increase only relates to injuries sustained in road traffic accidents. Other personal injury claims through the small claims court will be subject to a ceiling of £2,000, with the exception of claims for minor psychological injuries such as travel anxiety and shock.

In addition to the new threshold for small claims, whiplash compensation claims will be settled according to how long the symptoms of whiplash persist. Over the seven bands ranging from “up to three months” to nineteen to twenty-four months” claimants will be entitled to receive a set figure of between £225 and £3,725 – generally much lower than the current levels of whiplash injury settlements. Strict definitions will be applied to what constitutes a whiplash injury in order to reduce the scope for whiplash compensation claims to circumnavigate the new measure.

In one further significant change to whiplash compensation claims, insurance companies will be prohibited from making an offer of settlement without medical evidence. This measure will help eliminate bogus whiplash compensation claims and encourage insurance companies to make fair and accurate offers of settlement to claimants injured in a road traffic accident. The Ministry of Justice commented it expects the savings made by insurance companies under the changes to be reflected in the cost of future motor insurance policies.

The Ministry also added that judges would have the discretion to increase or decrease whiplash compensation settlements by up to 20% “in exceptional circumstances”. No definition has been given of what “exceptional circumstances” should involve, the Ministry believing it is more appropriate for the courts to decide when circumstances are exceptional.