The Ministry of Justice (MoJ) has released a statement on the claims process for low value road traffic accident personal injury claims.

Michael Willis MP, deputy to the minister of the MoJ, said that parties have reached broad agreement on the detail of the new scheme, which aims to streamline personal injury claims valued between £1,000 and £10,000.

He said: “This will reduce the time taken to settle disputes by setting fixed time limits and costs for settling less complex claims. It will also be a significant step forward in helping victims of car accidents receive justice through compensation quickly and simply.

“Ministers are grateful to the Civil Justice Council who have mediated an agreement between claimants and insurers on the fixed recoverable costs which will depend on which stage of the new process each case reaches.”
The agreed fixed costs are:

• £400 for Stage 1 – where the claimant solicitor completes the claim notification form and sends it to the insurer who may admit/deny liability;
• £800 for Stage 2 – where liability is admitted, the claimant obtains a medical report and the process continues with offers and negotiation of a settlement to a strict timetable.
• £250 paper hearing / £500 oral hearing for Stage 3 – where the parties cannot agree a settlement and the case goes to court.

The Civil Procedure Rule Committee sub-committee will work with officials to bring forward draft rules, practice directions and pre-actions protocols to implement the new process. The aim is to implement it in April 2010.

In response, Nick Starling, the Association of British Insurers’ (ABI) director of general insurance and health, said: “The ABI has long argued for a simpler, more streamlined compensation system that works in the interests of consumers, so we completely support today’s announcement. This new process will cut down on delays, and reduce the high legal costs that are paid for through motor insurance premiums.

“It is now vital that employees injured at work have the same opportunity as those injured on our roads to benefit from this new process, so we call on the government to extend it to cover employers’ liability insurance claims.”
In a statement, the Association of Personal Injury Lawyers (Apil) said: “After a year of protracted discussion and negotiation, followed by three challenging mediation sessions, we welcome the fact that we now have an agreed process in principle. There is, of course, still much to be developed and tested, such as the rules themselves and the IT needed to implement the new process.

“During this exhaustive level of consideration by all involved, Apil has continued to focus on the needs of injured individuals, and the need for solicitors to be able to continue to offer vulnerable people effective independent legal advice.

“We sincerely hope that we can now settle down to getting on with the work of caring for those who need it, in a spirit of co-operation. We also urge Lord Justice Jackson to take this work into account as he deliberates on his civil costs review.”

Source - http://www.broking.co.uk/insurance-age/news/1555771/moj-claims-reforms-announced