Policy paper: Civil Liability Bill

Ministry of Justice - by Jim Larrison via Flickr

The Civil Liability Bill makes important changes to the personal injury compensation system in England and Wales. The Bill reforms how the personal injury discount rate (PIDR) is set, aiming to ensure claimants get full and fair compensation to meet their expected needs while reducing the pressure on meeting excessive compensation claims on the NHS; and it delivers on a manifesto commitment to tackle the issues behind the continued high number and cost of whiplash claims.

The Whiplash measures in the Bill will:

  • Provide for a tariff of compensation for pain, suffering and loss of amenity for whiplash claims. The final tariff figures will be set in supporting regulations to be debated via the affirmative procedure by Parliament following Royal Assent.
  • Introduce a regulatory ban on seeking or offering to settle whiplash claims without medical evidence.
  • Provide for the Judiciary to increase the compensation payable by up to a certain amount in exceptional circumstances. The cap for exceptional payments would be set in supporting regulations.

The PIDR measures in the Bill will:

  • Retain the 100% compensation principle which has long been a central part of the law, but modernise the calculation of the discount rate so that it reflects the reality of how claimants actually invest their money.
  • Put the process of setting the rate on a statutory footing, with expert independent advice and a requirement for the Lord Chancellor to set it every 3 years, giving clarity and assurance to claimants and to those who underwrite the costs.
  • Create an independent expert panel to advise the Lord Chancellor in order to ensure that the rate is set fairly and transparently in future, protecting the interests of claimants. The regular setting of the rate will make sure that vulnerable people who have had life-changing accidents have their compensation adjusted by an up to date rate.


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