After being injured in a road accident, the last thing anybody needs is long drawn out legal process. Fortunately, in the very near future, the waiting time for most of these cases is going to be dramatically shortened – if the lawmakers have finally got it right.
With effect from 30th April 2010, a completely new process for road accident injury claims becomes compulsory and where the insurer of the driver responsible for the accident admits liability immediately, the claim should normally be finalised in a matter of a few months.
Here’s how it works
Stage one
First, the injured person’s lawyer will have to email a very detailed Claim Notification Form to the insurers via a central website operated by the Ministry of Justice.
Once they have received the form, the insurers have only fifteen business days to state whether or not they accept liability. If they do AND comply with certain other time limits, the claim will be dealt with under the new procedure. The insurers will benefit because the legal costs they have to pay will be much reduced and the injured person will benefit from a far simpler and faster process.
Stage Two
If the injured person owns the car driven in the accident, then his or her lawyer will probably arrange for either the repairs, or an inspection and valuation if the vehicle is a write-off. As far as injuries are concerned, the lawyer will arrange to have the person assessed for treatment and an examination by an independent medical practitioner who will prepare a medical report in the format required by the new process. This will cover the extent of the injuries and their likely ongoing effects on such things as the ability to work and go about normal daily activities.
This medico-legal report, together with further details of the claim, must be emailed to the other driver’s insurers within fifteen business days of it being approved by the injured person.
The Final Settlement Pack
When the claim is ready to be settled, the lawyer must discuss and agree with the client the amount of compensation to be sought. Clearly, this must be a realistic figure based on the lawyer’s expertise in personal injury work. The compensation claim, together with a list of the injured person’s out of pocket expenses, will then be submitted electronically through the central website to the other driver’s insurers in the form of a Settlement Pack
The insurers then have a further fifteen business days either to agree the amount sought or make a counter offer. After that, a further twenty business days are allowed to enable negotiations to continue.
The Interim Settlement Pack
If the medical report indicates that further medical evidence may be needed at a later date before the claim should be settled, the injured person’s lawyer should ask for a payment on account of the claim of £1000.00, which cannot be refused. (They can seek more than this where valid reasons are provided). The claims process is then put on hold until they can produce the final medical evidence at which point the Final Settlement process is followed.
What happens if the claim leaves the process?
If the insurers do not accept liability; do not comply with the time limits described above; deny that the symptoms referred to in the medical report were caused by the accident; or if they allege fraud, the claim leaves the new process and the matter is then handled by the current more lengthy and expensive process.
Generally, it will not be in the interest of insurers to allow the claim to leave the new process as the legal costs they will have to pay, if the claim succeeds, will be far greater.
What happens if the value of the claim cannot be agreed?
Stage 3
If no agreement about the value of the claim has been reached after the period allowed for negotiations has expired, it remains in the process, but the insurers must pay the value of their last offer and Court proceedings are then issued. These can take the form of an oral hearing, or (if both sides agree) by means of detailed written statements sent to the court so that the District Judge can value the claim.
Whilst the District Judge at the Court will be aware that settlement offers have been made by both sides, the amount of the final offers will be kept in a sealed envelope until after the amount to be awarded has been decided.
Getting it right here is very important because if the District Judge awards more than the insurer’s highest offer, the insurer must pay both sides’ legal fees of the Stage 3 process, plus the court fees. However, if the amount awarded is less than that offered by the insurers in Stage 2, the injured person will be liable for the costs of both sides of the Stage 3 process. Plainly, it is essential that the injured person’s lawyer has ensured that they have adequate legal expenses insurance (legal protection) to cover them in case this happens and that the legal expenses insurers have agreed with the lawyer’s recommendation that the claim proceeds into Stage 3.
Getting the right advice
A single word of warning. Generally the new process will be far better for accident victims than the current one as both sides are both obliged and incentivised to proceed very quickly. However there is the risk that, because the legal fees will be so much lower, shortcuts may be taken by legal representatives. Their clients may even advised to accept offers well below the true value because lawyers will receive no additional payment for the extra work put in, or the additional time necessary to pursue claims through to their proper conclusions.
Chris Lodge has specialised as a Road Traffic Accident Solicitor for over 25 years and sits as a representative for the Motor Accident Solicitors Society on a Ministry of Justice working party testing and piloting the electronic notification form described above.
