We are the voice of insurance and long-term savings | Contact us

Calls grow for the Government to act now on reforming personal injury compensation

The ABI (Association of British Insurers) has today joined forces with the CBI and Citizens Advice to call for the Government to introduce its proposals for reforming personal injury compensation without delay. These will enable personal injury compensation to be paid more quickly to injured people.

In April 2007 the Government published proposals for a faster, fairer, more cost efficient compensation system. Implementing these proposals now would save 110 million days a year in delays dealing with personal injury claims following motor accidents alone.

Speaking at an ABI parliamentary reception today to launch Adding Insult to Injury: the need for reform of the personal injury compensation system, Stephen Haddrill, the ABI's Director General, said:

"Our compensation system is failing many claimants. It is too slow, riddled with high legal costs and undervalues rehabilitation. Insurers want to pay compensation and arrange rehabilitation faster than the current system allows. Personal injury claims following a motor accident take on average two years to settle, with three years on average for workplace claims. This is unacceptable.

"The Government has grasped the need for reform. We look forward to implementation of their proposals without further delay. Every day without change is another day of unnecessary delay for claimants."

The CBI said:

"The CBI will work in partnership with others to facilitate a system that is claimant-centred, fair, more streamlined, less adversarial and enables early rehabilitation so that claimants can receive speedy treatment and return to normal work and life as quickly as possible".

James Sandbach, Citizens Advice, said:

"For many thousands of people who have experienced accident or injury through no fault of their own, often suffering disabling effects, the system is failing".

Notes for Editors

  1. Enquiries to:

Alan Leaman 020 7216 7440 (Mobile: 07957 482 330)

Jonathan French 020 7216 7392 (Mobile: 07958 330 480)

Malcolm Tarling 020 7216 7410 (Mobile: 07776 147 667)

Erfan Hussain 020 7216 7411 (Mobile: 07712 841 184)

Kelly Ostler-Coyle 020 7216 7415 (Mobile: 07968 364 302)

  1. Adding Insult to Injury: the need for reform of the personal injury compensation system is available from 25 March on: http://www.abi.org.uk/BookShop/ResearchReports/PI_Reform.pdf

3. The Government's proposed reforms

    • Early notification of claim - claimant lawyers should notify insurers about a claim within five days of taking instructions from a claimant.
    • Remove work duplication - insurers should investigate claims, and if they agree they are liable will negotiate settlement. There will be no need for claimant lawyers to carry out their own investigation into liability.
    • Set challenging timescales for insurers - who will have 15 days to decide if they are liable for a motor claim and 30 days for a n employers' liability or public liability claim.
    • A simple process to negotiate level of compensation - through defined timescales within which both sides should aim to agree settlement. Where agreement cannot be reached, the case will be referred to a district judge for a decision.

  1. Days of delay in settling personal injury claims

In the past year 200,000 of the 250,000 personal injury claims due to motor accidents would have been straightforward and non-contentious. It currently takes an average of two years -or 730 days - to settle these claims. That is a total of 146 million working days. If the Government's proposals were implemented now, this would reduce by 110 million to a collective 36 million days.

  1. The ABI is the trade association for Britain's insurance industry. Its nearly 400 member companies provide over 94% of the insurance business in the UK. It represents insurance companies to the Government, and to the regulatory and other agencies, and is an influential voice on public policy and financial services issues. ABI member companies hold up to a sixth of all investments traded on the London Stock Exchange, on behalf of millions of pensioners and savers.

  1. An ISDN line is available for broadcasts.

Copies of all ABI news releases, together with other information from the Association, can be seen on our website http://www.abi.org.uk

Last updated 01/07/2016