Personal Injury Brief market insights – February 2020

A summary of key developments including an update on bereavement damages, an expected consultation on a dual discount rate, an overview of a new bill looking at the impact of video gaming, the government response to the consultation on regulations requiring insurers to report on savings, an update on Scottish civil justice reforms and the Northern Irish discount rate.

Video Gaming Health and Wellbeing Strategy Bill

On 20 January, Lord Brook of Alverthorpe (Labour), introduced the Video Gaming Health and Wellbeing Strategy Bill to the House of Lords. It is a private members bill and if passed will ensure the Secretary of State develops a health and wellbeing strategy and to provide related health advice. The Bill is also seeking academic and medical research on the effects of video gaming on children and adolescents, and an assessment of NHS provisions for the effects of video gaming on children and adolescents. The date for the second reading has yet to be announced.

Contact: Kim Carrim

Related item: Emerging psychiatric inflation factors: complex PTSD, gaming disorder and opioid dependence

England and Wales

Bereavement damages update – tariff adjustment and allowing cohabitants to claim

On 12 February, the government responded to the 21st report from the Joint Committee on Human Rights session 2017-2019, on a proposal to implement the Court of Appeal judgment in Smith v Lancashire Teaching Hospitals NHS Foundation Trust & Others [2017], to make bereavement damages available to claimants who cohabited with the deceased person for a period of at least two years immediately prior to death.

In the report, the government confirmed they would make changes to cohabitants in line with the Smith decision and that there would be an adjustment made to the fixed tariff to reflect inflation. Currently capped at £12,980, this is in stark contrast to the Scottish model were damages can be significantly higher, although along similar lines to Northern Ireland where the fixed sum is currently set at £15,100.

Contact: Scott Nightingale

Related item: Cohabitees no longer bereaved and aggrieved

Discount rate review: consultation on dual or split rate expected 

Government Actuary, Martin Clarke, has suggested that a dual or split discount rate is a possibility for the next discount rate review. Speaking at an industry event at the end of January, Clarke said a consultation is expected to follow before the next review to explore the issue further.

The current discount rate was set at -0.25% with effect from 5 August 2019. The rate must be reviewed at least every five years, although it is open to the Lord Chancellor to review the rate at an earlier time if there is good reason to do so. Whilst the current rate is a single rate, the legal framework under which the rate is set allows for a dual or split rate. 

Clarke also said that he hoped the Advisory Committee will be set up well in advance of the next review to avoid ‘war-game’ decisions and agree methodology.

Contact: Mark Burton

Civil Liability Act report on savings provision – government response to consultation

On 31 October 2019, the government provided their response to the consultation on draft regulations that will require firms to report on whether they have passed on savings to their customers.

The consultation received 16 responses and has led to a number of changes to the statutory instrument (SI). Key changes include limiting the scope of ‘personal motor insurance policyholders’ and adding a new definition of private motor insurance policies that is compatible with road traffic legislation. The SI will now be subject to further amendment, legal checks and parliamentary approval.

Contact: Roger Davis


The Scottish Civil Justice Council expected to shortly receive rules from the Scottish Government’s Costs and Funding Committee for QOCS and SFAs 

Key changes to be adopted following the Civil Litigation (Expenses and Group Proceedings (Scotland) Act 2018, include a cap on the level of the success fees agreements (SFAs) and the introduction of qualified one-way costs shifting (QOCS) for personal injury claims. The provisions allow for a phased implementation and for a post-legislative review in five years’ time.

There is no firm timescale for the introduction of QOCS or SFAs but it is anticipated that the rules could be finalised by the end of February or March, after which the rules will be subject to affirmative procedure, which requires the approval of the Parliament, and so the earliest date they can realistically come into effect is April 2020. The plan as we understand it is that the QOCS and SFA regulations will be introduced simultaneously.

Compulsory personal injury pre-action protocol (CPAP)

There is ongoing discussions about increasing the current limit of £25k on claims that are subject to the CPAP. No decision has been made but there has been suggestions that the increase could be £50k or £75k.

Contact: Clare Crawford 

Northern Ireland 

Change to current discount rate: announcement expected

Government Actuary, Martin Clarke, has suggested that the rate could be as low as -2% if Northern Ireland do not pass their own discount rate legislation and continue to use the old Wells v Wells approach.

For now, the rate remains, at least technically if not always in practice, at 2.5%. It is understood that the Department of Justice is currently taking expert advice on rate-setting and we expect to hear from them before the end of the month.

Contact: Amanda Wylie

Related item: Personal Injury Brief market insights - October 2019

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