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Looking Ahead: Motor Claims

29 March 2021
Nigel Teasdale looks ahead to the imminent implementation of the whiplash reforms and explores the potential issues on the horizon that come with advances in micromobility and vehicle technology.

Whiplash reforms… and beyond?

We have said this many times before, but it seems that 2021 will finally be the year that the "whiplash reforms" are implemented. The reforms, dating back to George Osborne's Autumn Statement of 2015, were set to be implemented in 2020 but were postponed after COVID-19 hit. That delay was initially to April and then until May 2021, as a result of difficulties in completing the rules during lockdown and concentrating resources in other areas.

However, even after the reforms are implemented, it is unlikely things will settle down for some time. As there was after the implementation of LASPO, we anticipate that there will be a period of disruption in the motor market, as accident management companies and claimant lawyers get a taste of post-reform life and adjust their operating models. Those continuing to process whiplash claims are likely to be reliant on "layering" claims to replace income lost due to the reforms and undoubtedly new battles will be fought over minor injuries falling outside the scope of the reforms and how to value those claims, particularly where there is a whiplash injury and other injuries.

Beyond that, the Ministry of Justice have previously indicated that they would then turn their attention to the second part of their response to the 2016 whiplash consultation, which looks at rehabilitation and credit hire. Whilst a solution for the friction caused by credit hire claims might be beyond the MOJ, rehabilitation seems likely to be tackled as part of a further package of injury reforms, although it appears that we will have to wait for the new portal, Official Injury Claim, to bed in before we see what form they might take and that might take some time.

At a time when the civil court system is creaking and the concern is whether additional small claims relating to whiplash might tip it over the edge, the new Master of the Rolls, Sir Geoffrey Vos, indicated in a recent speech that he would like to see an "online funnel for civil claims", as part of a fundamental generational review of the civil justice system, in which all claims begin online, before entering a digital court process. Lofty ambitions indeed…

Balancing advances in micromobility and vehicle technology with road safety

E-scooters are now a regular feature in the news and often seen on our roads and pavements (albeit they shouldn't be there!). Trials for e-scooters have commenced in a number of cities, although logistical problems have meant that the trials in London, which are perhaps the most significant, are yet to begin. The trials have been strictly regulated on the basis that the rental e-scooters are insured, speed limited and a driving licence is required to ride them.

It is expected that data from the trials will lead to a framework of governance around the wider legalisation of e-scooters. There remains real concern that outputs from a sanitised trial will not reflect the reality of the dangers of e-scooters and the need for insurance, but one way or another e-scooters will have a greater presence on UK roads in 2021 and, in turn, in claims notifications.

Whilst there are many facets to advances in vehicle technology, two key items in the news in the latter part of 2020 and likely to be a feature of 2021 are smart motorways and Automated Lane Keeping Systems (ALKS).

Smart motorways use traffic management methods to increase capacity and reduce congestion. In particular, these methods include using the hard shoulder as a running lane and using variable speed limits to control the flow of traffic.

However, in January a coroner declared that they presented an ongoing risk of future deaths after the lack of a hard shoulder was ruled to be a contributing factor in two fatalities, and he would be writing to Highways England and the Secretary of State for Transport to call for an urgent review. It remains to be seen what action will be taken.

ALKS, like smart motorways, are undoubtedly beneficial in using new technology to provide greater mobility solutions, ease congestion, and, in the long term, reduce accidents. However, again the concern is in trying to run before we can walk. Introducing ALKS trials is one thing, but declaring vehicles with ALKS to be automated vehicles under the Automated and Electric Vehicles Act 2018 is pushing the boundaries too far and risks compromising road safety needlessly.

The Government's desire to place the UK at the heart of advancing vehicle technology is admirable but needs to be balanced with the time to consider safety and regulatory requirements in the short term to not damage consumer confidence in the longer term. We think that may be a theme of 2021 as we see how those issues develop.

Read our full report 'Looking Ahead in the Insurance Sector'.

Further Reading