Chancellor’s statement hits PI firms
Chancellor George Osborne has set the cat among the pigeons at professional indemnity firms with his plans to save legal costs by transferring personal injury claims of up to £5,000 to the small claims court and scrap general damages for ‘minor’ soft tissue injuries.
Speaking in the House of Commons, the Chancellor said that the Government was going to:
‘bring forward reforms to the compensation culture around minor motor-accident injuries.
‘This will remove over £1bn from the cost of providing motor insurance. We expect the industry to pass on this saving, so motorists see an average saving of £40-50 per year off their insurance bills.’
The move has hit several PI firms very badly with Australian law firm Slater & Gordon, which operates in the UK personal injury claims business, losing more than half its stock market value.
In other plans, the Chancellor announced that the government would be investing more than £700m to modernise the courts and move them from a paper-based to an online system thus eliminating the need for over half a million pre-trial hearings in the criminal courts, and significantly reducing court hearing times.