Personal Injury Law

Personal Injury Law

26 April 2016

 

Yvonne Fovargue (Makerfield) (Lab)

What assessment he has made of the potential effect of planned changes to personal injury law and whiplash claims on access to justice.[904666]

 

The Parliamentary Under-Secretary of State for Justice (Mr Dominic Raab)

The Government remain concerned about the number and cost of whiplash claims, and in particular the risk that unmeritorious claims push up the cost of insurance for customers. New proposals have been announced. We will consult on them in due course, and they will be accompanied by an impact assessment.

 

Yvonne Fovargue

There still appears to be no independent verification of the fraud culture and pandemic of claims cited in the autumn statement as the reason to raise the small claims limit for personal injury. In fact, not one motor insurer even mentioned fraud as a material risk when reporting their annual returns to the stock market. What independent evidence does the Minister have of a fraud culture? Would it not be more effective to legislate to stop the ambulance-chasing claims management companies making unsolicited calls, rather than denying justice to those who have been injured through no fault of their own?

 

Mr Raab

We should address both angles. The Chancellor has already announced proposals to remove the right to claim damages for pain and suffering for very minor claim and to increase the small claims limit to £5,000. That is important, as it will help us cut the cost of resolving cases. As I said, we will consult on the reforms, but, critically, they will save the insurance industry £1 billion annually. The industry is committed to passing those savings on to customers, which will reduce premiums by £50.

 

Chris Philp (Croydon South) (Con)

Does the Minister share my concern that car insurance premiums are £93 a year higher than they need to be thanks to fraudulent claims, and that claims here are orders of magnitude higher than in Europe? Does he agree that the new limit will go a huge way towards combating this costly and invidious practice?[904682]

 

Mr Raab

My hon. Friend is absolutely right. As we move forward to the consultation and take into account all the evidence, the key thing is to make sure that there is proper access to justice but also that we cut the cost of insurance premiums for consumers. That is what we intend to do.

 

Nick Thomas-Symonds (Torfaen) (Lab)

If these reforms are so positive, why is the president of the Law Society gravely concerned that they may undermine the rights of ordinary citizens to obtain compensation for negligence?[904686]

 

Mr Raab

The Law Society quite properly protects the professional interest of its members. We must consider all evidence that we receive and look at this in the round, rather than just take into account what the lawyers think.

 

Mr David Nuttall (Bury North) (Con)

Even if the number of fraudulent claims is as high as the 7% that some believe it is, given that courts already have the power to strike out fraudulent claims, why should the innocent majority of genuine claimants be penalised because of the potentially criminal behaviour of a few?

 

Mr Raab

Our reforms are precisely aimed at weeding out spurious, frivolous or trivial claims, and ensuring that we preserve access to justice for important and meritorious claims. At the same time we must ensure that people who pay their insurance premiums year in, year out, are not penalised by those who are taking the system for a ride.

 

Exact from: https://hansard.parliament.uk/Commons/2016-04-26/debates/16042636000004/Justice