Derision at government’s proposed cap on Road Traffic Accident claims

The government’s proposed £300 cap on Road Traffic Accident claims through the RTA portal, an online system which handles routine, low value personal injury claims, have been met with widespread derision across the legal profession.

This slashing of the current legal fee would mean a significant decrease of 75% from the current £1200 cap, itself also a significant drop from the previous rate charged by solicitors which is seen by many as a cut that would not be tolerated in many other industries.

Whilst Bonallack & Bishop enjoys a solid enough reputation to be able to attract high-quality compensation claims and therefore avoid lower level claims work, there are many smaller law firms who may be forced to accept this level of work albeit to be undertaken by junior fee earners or newly qualified and inexperienced staff which will in turn devalue the claims process and industry.

Conversely, insurance companies will fully benefit from the changes and the level of competition could prove untenable with highly qualified lawyers employed by them pitted against inexperienced legal staff in other areas. In other words, rather than a no win no fee result for the consumer, we will soon be seeing a win win result for the insurance companies.

Some claimant personal injury solicitors have also expressed concerns over the potential increase in fraudulent claims whilst others believe that the cuts will give rise to corner cutting and reduced due diligence.

The proposal came to light during roundtable discussions with the justice minister, Jonathan Djangoly, although the Ministry of Justice is insistent that figures have yet to be finalised following stakeholder consultations taking place this month.

Deborah Evans, chief executive of the Association of Personal Injury Lawyers commented that there were ‘cases are diverse and liability is invariably denied, which means automatic exit from the portal…if the portal approach is to be extended, sound evidence must be collected to establish what the work actually costs. The process will need to be mapped, costed and then bespoke portals created.’