Justice Committee launches whiplash reform inquiry

An inquiry into how whiplash injuries resulting from traffic accidents are processed following the 2021 reforms has been launched.

The parliamentary Justice Committee will investigate the effects of whiplash reform and how the Official Injury Claim portal operates.

A focus of the inquiry will be the purported savings in premiums of between £40 and £50 a year per motorist that were originally put forward as a major benefit.

These savings would be possible because insurance claims for whiplash injuries were costing insurers more than £2 billion per year, adding an average of £90 to car insurance policies.

Whiplash reform contained two main thrusts: an increase in the small claims limit for personal injury claims, so the majority would proceed through the cheaper small claims track where legal costs are not recoverable, and the launch of the Official Injury Claim portal.

The portal, which was set up by the insurance industry, would become the only avenue for making a claim for any road traffic-related personal injury valued under £5,000, including claims for whiplash. As a result, claimants could settle their own claim without the use of a lawyer.

Almost two years on since these changes came into effect and the portal went live, the Justice Committee will examine their impact and whether the mooted savings have been passed on to drivers.

Sir Bob Neill, chair of the Justice Committee, commented: “Whiplash injury claims have been costing motorists a disproportionately large amount of money and taking up a lot of precious court time.

“That’s not to minimise the pain and suffering such injuries can cause. But if we can find a way of saving money and court time we should do so.

“So we’ll be looking carefully into the way claims are being processed and how much they cost motorists and the wider tax-paying public. We want justice to prevail, but we want it to be efficient as well.”

Commenting on the inquiry, Andrew Wild, head of legal at First4InjuryClaims, said: “RTA (road traffic accident) claims have almost halved since 2018 but the promised savings for motorists have yet to materialise—insurance premiums have actually gone up.

“Of those who do pursue a claim via the Official Injury Claim portal, 90% still require legal representation to help them navigate the supposedly simple system they were told they would not need a lawyer for.

“The portal has been so poorly marketed and plagued with issues that motorists could be forgiven for giving up, particularly when the average settlement time currently stands at more than seven months.

 “An inquiry into the reforms has to be welcomed but, almost two years in, I hope this is not simply a box ticking exercise, but rather a meaningful dialogue with lawyers and other stakeholders to genuinely improve a system which promised to provide access to justice but is so far failing miserably.”

The deadline for making submissions to the inquiry is 5pm on 17 March.

Image source: Canva

Mark Dugdale