The ABI has developed a code of practice ("the code") for insurers which seeks to ensure good customer outcomes in the new legal environment created by the Legal Services Act and the Legal Aid, Sentencing and Punishment of Offenders Act 2012 ("the LASPO Act").
Why has the ABI produced the code?
The LASPO Act introduced the most significant changes to the civil justice system in England and Wales in over a decade. The aim of these changes is to ensure access to justice for personal injury claimants, but at proportionate cost. The insurance industry is committed to paying fair and reasonable compensation to genuinely injured claimants as quickly as possible.
Insurers have long campaigned in support of these changes and want to ensure that both the letter and the spirit of the rules underpinning the reforms are embedded into everyday insurer practice. The changes are designed to assist those who have been injured to claim appropriate compensation in a timely and cost efficient way, and to provide a greater degree of certainty and cost control.
How does the code help customers?
As an industry that is constantly innovating, insurers want to continue to provide as much support to their customers as possible and some insurers are now offering legal services, either direct to their customers or via third parties, to help them with their claims. Insurers are committed to ensuring that any actions they take in this new legal environment lead to a reduction in the number of unmeritorious or inflated personal injury claims, especially for whiplash.
The code aims to ensure that in a fast-changing and regularly-evolving legal environment, the interests of all consumers come first - both in accessing compensation and also in making the claims system as cost efficient and effective as possible. Insurers want to give customers and other stakeholders confidence that, in operating in the new civil justice landscape, they are working in the interests of genuinely injured claimants, of the premium paying public and for the wider public good. We believe that the code achieves this objective.
Is it compulsory?
No, the code is voluntary. ABI publishes a list of ABI members who have confirmed their compliance with the code.
When will it commence?
The commencement date for the code is 13 February 2013