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Thursday, 3 May 2012

Accident Claims - no small matter

The Small claims court has been around for many years. Its role is to resolve straightforward and low value claims such as consumer problems or neighbour disputes. It is a lawyer free court and neither side can recover legal costs in most cases. Apart from Personal Injury cases the limit for the court is claims up to £5k.

Personal Injury Claims were always felt to be different because of the need for medical evidence and because they are generally more complex. In those cases the limit is just £1k. This acknowledged the need for accident claimants to have professional advice when dealing with insurers and their lawyers.

This was still the view of the Ministry of Justice earlier this year. It published a document as recently as February stating that the limit of £1k should remain.

Now apparently at the whim of the insurance industry the MOJ has changed its mind. The limit is to be increased to £5k. This will place the majority of accident claims in the small claims court and remove the right of claimants to have legal representation.

Minister Jonathan Djanogly has made it quite clear what the government’s agenda is –

“Our proposed reforms will make it much easier for insurers to defend claims through the court system”

They will also make it virtually impossible for genuine claimants to pursue cases with proper professional advice. There is bound to be a big reduction in the amount of claims.

This is to reduce insurance payments and thereby to increase the profits of wealthy insurance companies. The rhetoric being used to promote this is that the claims are causing premiums to increase. So these so called reforms will benefit all of us.

I should say that as a driver, I would be extremely surprised if that happened. Will the Insurance Industry guarantee that they will publish the total increase in profits that these measures will achieve? Will they also guarantee that the whole of such increase will be rebated to motorists? There might be a small reduction before the next election for obvious reasons. But to suggest a huge and generous reduction is fanciful.

We are told that there is a need to reduce fake claims. There have always been fake claims. These can be removed by robust medical evidence not by effectively removing from everybody the right to bring a claim.


  1. Accident, whether it is a big or not! We have right to claim against the person who is responsible for the accident.

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