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On 21 November 2024 the ‘Lord Chancellor’s Report and Recommendations’ following the statutory review of the Whiplash Injury Regulations 2021 (the Regulations) was published and presented to Parliament.
Detailing the review process that was carried out, Lord Chancellor, Shabana Mahmood’s report also sets out the recommendations made, that include increasing the whiplash tariff. Here we provide an overview of the three key areas of the review, and a summary of the Lord Chancellor’s decisions and the next steps.
Whiplash tariff
The review of the tariff included consideration of the structure of the tariff, its component parts, the duration bands, the tariff split in relation to minor psychological injuries, mixed injury claims, inflation, and wider factors relevant to the claims market.
Decisions
- Current structure and component parts of the whiplash tariff are to be maintained.
- Lord Chancellor to explore the provision of further guidance to assist in the definition of minor psychological injuries.
- Tariff figures in each band to be increased by 14-15% (accounting for CPI inflation between 2021 and 2024 and building in a three-year buffer).
Judicial uplift
The report notes that stakeholder feedback pointed to the lack of a clear definition in respect of what constitutes ‘exceptional’ for the purpose of satisfying the award of the 20% uplift. However, with the matter considered not to be one appropriate for government to determine, the report observes that with all cases being different, “each claim must be judged on its merits by the parties and/or the courts.”
Decisions
- Application of the uplift where the claimant has evidenced exceptional injury or circumstances, remains appropriate.
- The maximum uplift will be maintained at up to 20%.
Medical evidence
Regarding the section of the Regulations concerning the ban on pre-medical offers to settle, the review also considered data on the medical reporting process.
Decision
- The medical reporting definitions in the Regulations do not require further amendment at this point.
Next steps
- The Lord Chancellor will consult on those decisions with the Lady Chief Justice, and has indicated the consultation is expected to be completed within approximately 8 weeks.
- Stakeholders are to be informed of the outcome ahead of the revised Regulations being laid and debated in both Houses of Parliament.
- The revised Regulations must be approved by both Houses, and subject to that will then be applicable to claims arising from accidents occurring on or after the date of commencement of those Regulations.
- The Lord Chancellor’s report clarifies that the review was “not an evaluation of the whiplash reform programme in general or an assessment of its impact on individual claimants, the personal injury sector or court activity, and should not be considered as such.” Adding that a “separate post-implementation review of the reforms will be completed in due course, following the completion of this review and the implementation of its outcomes.”
Comment
The level of increase was lower than a number of commentators had expected and was met with cautious approval from compensators. The concern of course was that an increase of any significance would result in the upper bracket of tariff claims breaching the Small Claims Track limit but this concern has largely been removed and is welcomed by insurers. The report provides that “an initial analysis suggests that less than 5% of claims using the OIC would be valued above the small claims limit under the new tariff.”
The process to implementation is not swift and a likely date of late March or early April is realistic.
Related item: Review of the whiplash tariff completed but not yet published
United Kingdom