RTA claims fall to new low but insurance premiums in overdrive

The number of motor-related personal injury claims fell yet again in 2023 – continuing a downward trend that has now lasted long beyond the Covid lockdown.

Figures from the Compensation Recovery Unit, collated by the government, show just 352,230 motor claims were made last year. That represented a 5% fall on the previous year and 46% down on the number of claims in 2019.

While the pandemic prompted a dramatic fall in claims as fewer cars were on the road, the figure has fallen every year since 2020. In the final quarter of last year there were 83,050 reported claims – less than half the number from the same period in 2019.

At the same time, clinical negligence, employer liability and public liability claims all rose in 2023, while all still down on pre-Covid levels.

The key change in the RTA claims market in recent years has been the start of the Official Injury Claim portal in 2021 for all claims worth less than £5,000. Many law firms have exited the low-value RTA market because costs are not recoverable and the new tariff levels are not enough to return any profit. Many of those who have strived to keep running these claims have found either the system has caused delays or that cases where mixed injuries are reported have been slow to settle.

Commenting on the data, Matthew Maxwell Scott, director of the Association of Consumer Support Organisations, said: ‘On the face of it, there are fewer people reporting accidents and so that should be welcome. However, our view is that the number of RTAs hasn’t changed much, it’s just that in the face of a litany of government reforms, fewer and fewer people are choosing to claim for their injuries.’

Earlier this month, website confused.com reported that the cost of car insurance has increased by 58% over the past year, with premiums averaging almost £1,000. One of the drivers of the personal injury reforms of 2021 was the claim that premiums would fall by an average of £35.

‘Even the insurance industry cannot now claim that lower-value personal injury claims are responsible for rising motor premiums,’ added Maxwell Scott. ‘Given the dramatic fall in injury claims numbers, we need to ask what the value of cover is when it brings fewer and fewer benefits.’

The issue of how much claimants should receive for mixed injuries – where whiplash is covered by a tariff but others are not – will be resolved by the Supreme Court. The appeals in Rabot and Briggs arise from two cases in the county court in Birkenhead where the claimants suffered whiplash and other injuries. The county court held that compensation should effectively be available for each injury, with the Court of Appeal dismissing the insurers’ appeal. The case will be heard in the Supreme Court on 20 February.

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