Experts have warned that drivers are losing out on car insurance claims amid calls for the Government to intervene with expensive vehicle repair costs.
The Civil Liability Act 2018 reformed the claims process for road traffic-related whiplash injuries in England and Wales.
As part of the Act, methods were changed regarding the personal injury discount rate applied to lump sum awards of damages.
The Act requires the Treasury to present a report before Parliament by April 1, 2025, outlining how insurers' costs changed as a result of the Act coming into force and whether individuals have benefitted.
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An expert has slammed the new car insurance measures
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Part one of the Act was introduced on May 31, 2021, and implemented a statutory definition of "whiplash injury" and banned whiplash claims settlements without medical evidence.
According to insurers, there was a reduction in the value of claims between 2020 and 2023, which was greater than expected had the terms of the Act not been in place.
In the period between April 1, 2022, and March 31, 2023, insurers found that total claims values were 7.8 per cent lower than what would have been saved, with a difference of almost £200million.
The new report states: "The information provided by insurers shows that individuals who are policyholders benefitted from the reductions in costs for insurers through paying lower premiums over the reporting period of 2020 to 2023 than would otherwise have been the case if the Act didn’t exist."
Jonathan Scarsbrook, immediate past president of the Association of Personal Injury Lawyers (APIL), commented on the latest report, warning that drivers could find themselves out of pocket when trying to claim.
He said: "There has been a 71 per cent increase in motor insurance premiums since the reforms were introduced despite an 11 per cent decrease in the cost of injury claims settled by car insurers.
"The evidence has always pointed to repair costs being behind rising premium prices.
"It's time the Government focused on these costs and the cost of hire vehicles rather than removing the right to full compensation for physical and psychological harm."
He warned that slashing compensation for "painful" and "avoidable" whiplash injuries would lead to further issues when the actual value is cut so much.
The expert said the new measures made a "mockery of compulsory insurance", which is designed to properly compensate people for their injuries in road traffic accidents.
Scarsbrook added: "This is a lose-lose situation for consumers, and they should be furious.
"They are spending more than ever for compulsory insurance on the understanding that they will be looked after if anything goes wrong.
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The Treasury is required to present a report to Parliament by April 1
GETTY"While vehicle damage can be inconvenient and worrying, bodily harm is the worst possible thing that can happen to someone."
