Whiplash tariff review: Anticipated CPI uplift and potential implementation in October 2024
The whiplash tariff review was completed by the previous Lord Chancellor, Alex Chalk, but the resulting paper was not subsequently published as planned on 3 June because of the election. Parliamentary recess recently ended on 2 September.
The new Government and new Lord Chancellor, Shabana Mahmood, does not have to abide by the decisions in this previous review, and it is unclear in any case when any changes (likely to be a proposed CPI uplift in the tariff) would be implemented save that these would usually occur in the months of April or October.
If, as anticipated, the previous review did support a simple inflationary increase, it appears likely this would be supported by the new Lord Chancellor. If she in turn sees this as easy to implement with no significant additional work needed, then October 2024 appears the most likely implementation date.
It is likely that any increase to the tariffs will not be retrospective and so will only apply to accidents from a set date e.g., 1 April 2025.
Judicial College Guideline (JCG) increases, including the recent 22% increase to non-whiplash tariff PSLA (Pain, Suffering, and Loss of Amenity) damages, are retrospective and so as soon as they come in the increased brackets apply to live claims. Similarly, if the Personal Injury Discount Rate (PIDR) changes that impacts live claims too.
However, the tariffs are potentially different e.g., it is generally accepted that they don’t represent 100% compensation (given pre Civil Liability Act awards, etc) and when the tariffs came in, they were based on a date of accident (DOA) trigger i.e., only applying where DOA is on or after 31st May 2021.
As a parallel, there is in essence a tariff for bereavement damages under the Fatal Accident Act. These last went up on 1 May 2020 from £12,980 to £15,120 but the new sum only applied where the date of death was after 1 May 2020.
Based on this, it does seem likely any tariff increases will not be retrospective.
While some insurer industry sources have previously predicted around a 15% increase, it now seems more likely that we’ll see a figure closer to the recent JCG 22% increase, and 20% seems a likely compromise figure.
For all concerned, it is hoped the Government presses on with this overdue review without further delay.
