New process for resolving third party motor personal injury claims
Apr 27, 2010
Ministry of Justice (MOJ) Reforms
On 30th April 2010, The Ministry of Justice is introducing a fast track process for road traffic personal injury claims. This will radically alter the way that motor personal injury claims are dealt with.
This new process aims to settle low value road traffic personal injury claims quickly and reduce solicitors’ costs.
The major changes introduced are that claims information will be shared electronically, liability decisions must be made within 15 days as opposed to 90 under the present protocol, and that legal costs will be fixed and recoverable on a staged basis.
The reforms necessitate the reporting of an accident quickly, so that insurers can deal with third party claims within the tight new time frame.
The claims affected by the reforms are third party motor personal injury claims specifically those:
- valued at between £1,000 and £10,000
- arising out of road traffic accidents in England and Wales only at the outset.
New claims handling process
The new process has three stages with strict timescales and fixed legal fees for each stage. The stages are:
Stage 1 Notification and Liability Assessment
- Third party notification received via portal by insurer.
- The insurer has 15 working days to acknowledge and communicate their liability decision to the Claimant Representative via the portal (extended to 30 days if the defendant is represented by MIB).
- Within 10 working days of accepting liability the insurer must pay the fixed base costs of £400 to the claimants’ representative.
- Claim to remain in the process if liability accepted.
Stage 2 Medical and Negotiation
- Claimant obtains Medical Report. A settlement pack (incl. medical report, receipts for special damages claims and claimant’s settlement offer) has to be sent to insurer within 15 working days of being confirmed as accurate.
- The insurer has 15 working days to consider the pack and either accept or reject it.
- 20 working days are allowed for negotiation whereby the insurer can reject the Claimant Representative offer and make a counter offer (via the MoJ portal using the settlement pack).
- If the offer is accepted insurers have 10 days to pay the damages to the claimant and Stage 2 fixed costs of £800, plus allowed disbursements to the claimants representative
- If agreement is not reached, the Claimant Representative will send a final version (stage 3) of the pack to the court. The insurer has 5 working days to respond and comment.
Stage 3 Court Hearing
- Court will determine quantum.
- Presumption of a ‘paper hearing’ but either party can opt for ‘oral hearing’ unless the judge directs otherwise.
- Claimant can apply to court for damages to be determined 10 working days after Stage 3 settlement pack sent to insurers.
- If ‘paper hearing’ court will notify parties of decision with reasons.
- Stage 3 costs will be payable within timescale set by Civil Procedure Rules or ordered by court. (Hearing costs £250/£500. If claimant wins – success fee of 100%.)
What does this mean for you?
The big challenge is to ensure that claims are reported to us as early as possible after an accident. This will allow insurers time to make any investigation pending receipt of the third party claim and the beginning of the 15 days time period for the process.
It is essential that you:
- Report claims involving third parties to us as soon as possible. If insurers haven’t got a report of a claim when the third party notifies they are immediately on the back foot.
- Gather evidence and help insurers make the right liability decision quickly, so that the right cases are defended for the right reasons and keep the right cases in the new process to save costs.
- If you populate the MID you must ensure that it is kept up to date as the MID will show where the portal should deliver the claim. If MID is wrong, by the time insurers get the Third Party notification claim it may be too late to get the case into the new process.
