Compensation in whiplash cases is “derisory and unfair”, CILEX argues

Compensation awarded for pain, suffering and loss of amenity (PSLA) in whiplash cases is “derisory and unfair” and fails to fully compensate claimants, CILEX told the Ministry of Justice (MoJ) in April.

The current tariff system which splits whiplash cases into ‘whiplash only’ and ‘whiplash plus minor psychological injuries’ is not a suitable approach, CILEX argued. Instead, where any psychological injury is present, “the injury should escape from the tariff” given the complexity surrounding such injuries and the potential impact on claimants, their financial position and family members.

It also argued that whiplash injuries lasting over three months were likely to be complex and continue indefinitely and as such should also be excluded from the tariff.

Responding to a call for evidence by the MoJ as part of its statutory review of the whiplash tariff, CILEX highlighted that for those whose injury duration was less than three months, the uplift in compensation where there was also a psychological injury stood at “a mere £20”.

According to CILEX, if the government “is adamant that the tariff’s structure regarding the inclusion of minor psychological injury should be retained”, then a 10% uplift should be standardised across all injury durations – higher than now. This would reflect the complexity of psychological injury and be “more representative of current legal practice where an adjustment is made when multiple injuries occur”.

The response also raised concerns that the possibility of differing prognoses for physical and psychological injuries was not reflected in the tariff.

CILEX members working in personal injury reported that the volume of whiplash settlements had fallen since the introduction of the tariff and raised concerns about law firms retreating from personal injury work “as whiplash claims become uneconomic to pursue”.

Despite the number of claims falling significantly since the Official Injury Claim portal was introduced three years ago, the government’s stated rationale for its introduction – the reduction of insurance premiums – has not materialised, with motor insurance premiums 34% higher compared to the previous 12 months.

Then CILEX president Emma Davies commented: “Psychological injury can be complex, may be longer lasting than the accompanying physical injury and can have a significant impact on a claimant’s ability to work and on their relationships with family. This is not reflected in current compensation levels which are set at a derisory level.

“Including psychological injuries as part of the whiplash tariff structure is insufficient, risking a serious undercompensating of injured parties. Where verifiable psychological injury is experienced alongside whiplash, we would like to see cases excluded from the tariff system altogether.”

The announcement of the outcome of the review, which was due at the start of June, was delayed because the election was called.