The Ministry of Justice (MoJ) are introducing a new insurance claims handling procedure from the 30th April 2010, and this places various statutory obligations upon lawyers and insurers. We have produced this newsletter to help you understand how the new process will operate and what this means. The MoJ has decided that lower cost motor personal injury claims generally take too long to settle and claimant lawyers fees are too high and disproportionate to the level of compensation (Damages) The process shown in the diagram applies to third party personal injury claims arising from road accidents happening on or after April 30th 2010, in England or Wales, if the estimated value of the claim is between £1,000 (Small Claims Court) and £10,000, excluding vehicle damage and hire.
It does not apply if either vehicle is registered outside the UK.
General Points
- Once liability is admitted at stage 1, it is binding on the insurer throughout the process.
- Admitting liability, before the start of the process, is not binding. This arises if a non injury claim is already progressing for, e.g. vehicle damage or hire.
- Admitting liability for the accident does not prevent an insurer from raising fraud issues.
- Stage 3 costs are much lower than legal proceedings outside of the process.
- If a claim leaves the process, it cannot reenter under any circumstances.
- Insurers will wish to keep as many third party claims as possible within the process.
- As the Motor Insurance Database (MID) will be used to help identify the relevant insurer, it is important to maintain this on an up to date basis.
- If the MID is wrong, by the time your insurer receives the third party notification claim, it may be too late get the case into the new process.
- If you want any further information or help please contact your claims handler.
