The government has announced a 15% uplift in the tariff for whiplash damages. Lord Chancellor Shabana Mahmood yesterday said that the limit on payments for soft tissue injuries would increase to take account of inflation to May 2024. The uplift also covers forecast inflation to May 2027, which is the likely date of the next review.
Lawyer groups have been pushing for news on an increase in damages since the previous government signalled in May that it would increase damages. The Civil Liability Act required the lord chancellor to review the tariff levels within three years of it being implemented in May 2021.
In a written statement to parliament, Mahmood also said she would maintain the existing split structure of the tariff (whiplash only and whiplash plus minor psychological injury) and provide additional guidance on defining minor psychological injury.
The government will retain judges’ discretion to uplift the tariff by up to 20% for exceptional injuries or circumstances.
Following the announcement, the Association of Personal Injury Lawyers said the uplift was welcome but that a 15% increase was not enough.
APIL president Kim Harrison said that if the lord chancellor were to increase the tariff, as introduced, in line with inflation using the Consumer Price Index, rather than making predictions about future inflation, the increase to damages in the tariff would be 22 per cent.
‘Increases in inflation have been eroding injured people’s damages since the tariff was introduced, a tariff which was set at an insulting, arbitrary level to begin with,’ added Harrison. ‘The outcome of this review has made an unjust situation even worse.
‘An inflationary increase to reflect how prices have gone up in reality over the past three years is the very least injured people needed. It seems they continue to be the whipping boys for the cost of car insurance premiums.’
Matthew Maxwell Scott, executive director of the claimant-focused Association of Consumer Support Organisations, pointed out that the uplift still requires consultation with the lady chief justice and further parliamentary hurdles.
He added: As things stand, the tariff has been eroded considerably by inflation, as the Lord Chancellor acknowledges, but we still run the risk of the tariff not being revised until around four years after its original implementation. That seems grossly unfair on injured people who have already had to face significant erosion of their rights. We also still don’t know whether the whiplash reforms have led to any of the promised savings for motorists, and so eagerly await the FCA report on this. In the meantime, and given record average premiums, the only winner seems to be the insurance industry.’
