February 2020 blog for Claims Magazine
Less than eight weeks to go until implementation of the Civil Liability Act (CLA) and the launch of the new consumer claims portal, or is it? For several months now the Ministry of Justice (MoJ) has been firm in its stance that the reforms will be implemented on 6 April. However, that stance seemed to be wavering at the recent Association of British Insurers (ABI) conference.
Why the lack of clarity for businesses to prepare? Well it seems that the MoJ are aware that there is a lot to do in an increasingly short timescale, not least a public awareness campaign, but continue to drag their heels in providing much needed details. Revealingly, they have acknowledged that an all-important public awareness campaign is needed but are unable to commit to when or how that will be agreed or the form that the campaign will take before the policy issues are dealt with. How can we be this close to such a major overhaul and still have unaddressed policy issues?
All along the rhetoric has been that the portal will be an effective method of handling whiplash claims so that access to justice is maintained. Yet at the ABI conference David Parkin, deputy director for civil justice and law at the MoJ, was quite clear that the new process will contain gaps. He even went as far as stating to the audience that you could try to get a system to deal with every possible eventuality but that would take years. Instead, they are aiming for the best, launching and seeing what happens. From there it will be monitored, tested and improved.
How can the MoJ disregard the interests of innocent claimants in being able to make valid claims against compensators and just push on regardless to launch something that they are aware is unable to deal with all eventualities? How does this fit in with the previous promises we have heard that the portal will not be allowed to launch until it is ready, that access to justice must be preserved? If the MoJ feels it will take years to deliver a fully capable system, then surely that is what it has to commit to doing? Isn’t that after all what was promised?
An insurer at the conference even talked about the need for a second tariff to deal with non-whiplash small claims. Their concern being that other small non-whiplash injuries will continue in a significant number of road traffic accident claims which will prevent them from delivering the savings promised to consumers through reduced premiums.
David Parkin clarified that there would be no tariffs for non-whiplash cases before the reforms are implemented. He stated that behaviours will have to be monitored but did not take any exception to an insurer openly suggesting that without further adjustment, the CLA is unlikely to deliver what it is supposed to. Why are the MoJ not concerned that the CLA is not going to deliver what it promised? Are they really that disinterested in consumers that they will simply press on regardless?
Section 11 of the CLA states that the report on the outcomes of the CLA are not due to be presented by the ABI and laid before Government until early 2024. So, we are very likely facing years of no savings being passed on to consumers despite the CLA being in place and access to justice and compensation awards being reduced throughout that period. Clearly another example of “we push on regardless” and yet, with no accountability within the CLA if insurers fail to deliver what is expected of them, the only likely losers in all this will be the innocent victims of RTA’s who now seemingly face no reduced premiums and being forced to try and pursue claims through a system which is acknowledged to be insufficiently developed to be able to deal with all possible eventualities.
This is not justice, this is chaos.
