Understanding the Civil Liability Act

For years, the UK government has been on the cusp of implementing the Civil Liability Act. This legislation is designed to change how personal injury claims related to road incidents are handled. The act was first introduced as a bill in 2018, but it has not gone into full effect due to a number of different delays. Now, it would appear as though it will finally be implemented in April 2021. With that in mind, it is important for policyholders and providers to understand what will be different.

The Civil Liability Act is intended to discourage fraudulent or exaggerated personal injury claims. Key aspects of the legislation that the government hopes will achieve this goal include:

  • A reduction in compensation for claims involving soft tissue injuries that affect the victim for less than two years
  • An increase in the small claims limit for car accident-related personal injury claims, from £1,000 to £5,000
  • A requirement for a medical assessment to have been performed prior to a personal injury claim being settled
  • A new online system that will help manage and settle claims under £5,000

According to industry experts, the implementation of the Civil Liability Act will result in approximately 95 per cent of personal injury claims moving from the fast track to the small claims track. This will result in solicitors’ fees not being able to be recovered. As such, solicitors will no longer be able to market themselves as not charging a fee without winning a settlement.

Without being able to recover their fees, solicitors may become less available for claimants. With that in mind, the new online system will assist policyholders in representing themselves in the small claims track.

Given the frequency of personal injury claims resulting from road-related accidents, it is clear that the impact of these changes will be widespread.

For more information, contact us today.