Millions held up in potential compensation as claimants wait
01/05/2021
£240 million held up in potential personal injury compensation as claimants wait over a year to reach a resolution in court. Current waiting time for a court hearing is 62 weeks for drivers disputing a car accident liability.
Zurich Insurance reveals today that an estimated £240 million* worth of claimant damages is currently tied up in the litigation process for over a year waiting for trials to proceed.
Analysis of Civil Justice statistics by the insurance giant shows that UK claimants from road traffic accidents have waited on average 62 weeks** just to be heard in court after a disputed car accident outcome or a whiplash claim if it litigates outside of the MoJ process.
Official figures highlight that the Covid-19 pandemic has made the court backlog of cases, both in the small claims and fast track processes, much worse with claimants now waiting even longer from the moment they litigate to the start of the trial compared to January this year.
Between April and June 2020, only a quarter of the normal volume of trials took place so catching up on the shortfall will further extend delays. Annually there are around half a million of whiplash claims logged in the UK (with an estimated value of approximately £3,000 per case) and even when cases stay in the MoJ process, if there is a dispute over valuation, the claimant may have to wait up to nine months for a Stage three determination.
Zurich has called on the Government to publish the rules and procedures for the new Litigant in Person Whiplash portal as soon as possible to enable the industry to scrutinise them and ensure that systems, policies, and procedures are thoroughly prepared and tested ahead of the April 2021 start date. Given that the Government confirmed in March 2020 that 'no practicable solution' could be found for the Alternative Dispute Resolution process, introducing a workable solution to resolve disputes must also be prioritised.
Calum McPhail, Head of Liability Claims at Zurich commented on the figures: “Pressure on court capacity as a result of the pandemic are creating delays of over a year from the point of litigating to trial date, and this is only likely to be delayed further due to the ongoing impact of Covid-19. As such, any further postponement to the civil justice reforms is likely to exacerbate this backlog and create more frustration for everyone. This kind of delay cannot be regarded as fair access to justice for an unrepresented claimant. The Government must ensure that the reforms are introduced alongside a straightforward mechanism to resolve disputes to free up court time and, ultimately, reduce the time taken to resolve disputes and settle claims.
“The insurance industry fully supports the personal injury whiplash reforms, but it is absolutely critical that when the new process is introduced, it must work fast and seamlessly for unrepresented claimants. If it doesn’t, there is a danger of driving these people into the hands of claims management companies who will take a cut of the pay-out.”
* Figure estimated based on an average whiplash claims value and the number of claimants in Stage 3 of the process. It only relates to whiplash quantum disputes at the Stage 3 process (litigation hearing) – the overall value in delayed cases across the courts is many times higher. 80,000 (current approx. number of unresolved dispute cases on quantum valuation progress to Stage 3) x £3,000 (average whiplash claim cost) = £240,000,000
**Civil Justice statistics quarterly: July to September 2020 - GOV.UK (www.gov.uk)
For further information, please contact:
Martyna Stepien
Media Relations Manager, Zurich UK
Email: martyna.stepien@uk.zurich.com
Tel: 07875 888284
