The Association of Consumer Support Organisations (ACSO), which represents consumers in the civil justice system, has called for a government review to determine the success or failure of a raft of recent personal injury legal reforms.
The call comes as the Official Injury Claim portal (OIC), which processes minor injury claims worth less than £5,000, approaches its fourth birthday, with more than one million claims submitted and around 300,000 processed.
ACSO executive director Matthew Maxwell Scott said a comprehensive review would also dovetail with the long-awaited study from the Financial Conduct Authority (FCA) to determine whether insurers have made good on their promise to return £35 per premium per year to motorists.
He said: “Motor insurers agreed to compensate consumers in return for them losing some of their rights of redress following an accident and the FCA has until the end of March to say whether that has happened, and to what extent.
“Given the cost of motor insurance is still near historic highs we are sceptical, to say the least, that insurers have met their promises but no doubt they will have some excuses ready.”
He explained that now was a good time for new ministers to take “a long, hard look” at the impact of the previous government’s personal injury reforms, which were designed to take out cost and cut the number of unnecessary or unmeritorious claims.
“The OIC has certainly overseen a dramatic fall in claims, by around 50 per cent since 2018, despite increasing vehicle numbers and consistent annual mileage. People are still getting injured, but for a variety of reasons are choosing not to claim. We need to know why, especially as the cost of motor insurance soared to record high levels in 2024.
“The portal was designed to be consumer friendly, so why do only about one in ten claimants use it unaided? Does the complexity of the portal journey put people off starting a claim in the first place?”
He noted that despite a ruling from the Supreme Court last year that resolved how to manage so-called mixed injury cases where victims have suffered a whiplash plus another injury, many are still stuck in the portal.
“We expected the mixed injury backlog to shift but it does not appear to have and we conservatively estimate that at least half a million such claims are still stuck in the portal.
“The review should investigate this and ask how the wider sector can work together better to agree frameworks to enable quick and fair settlement. Cases that cannot be settled end up in court, where defendants can buy another year of not paying out because it takes so long for a case to be heard.”
Maxwell Scott went on: “Thankfully, the Justice Select Committee has agreed to reinstate its inquiry into County Court delays, but that is only half the story. Of equal concern to injured people is that the insurance claims process still seems broken. While the FCA has implemented the Consumer Duty to ensure fair treatment for policyholders, the customer claims journey remains mediocre.”
In light of these deep-seated problems in motor claims, ACSO is calling for the FCA to publish its findings on premium savings immediately and for the Ministry of Justice to launch a full review of the Civil Liability Act measures in light of this and with a view to asking stakeholders how the OIC portal can be improved upon.
Maxwell Scott said: “The whiplash reforms came about as a result of intense insurer lobbying. There needs to be an equally intense examination now of what was promised versus what has been delivered, and what this can teach us about civil justice reforms more widely.
“The new government’s Motor Insurance Taskforce seems to have lasted about as long as its sponsor, the previous Transport Secretary. Her replacement needs to resuscitate it now and ensure it can be part of the review process too.
“As long as motor insurance is a compulsory product, giving consumers no power of exit, it needs to be held to exacting standards when it comes to transparency and value for money. Currently, no such standards exist.”