Budget Statement Blues for Medco?
Is St George (of Osborne) about to slay the (Medco) dragon?
When it comes to wishful thinking, the UK Register of Expert Witnesses is well known for wishfully thinking some change or other will spell the end for the parasitical MRO industry. Well, not being ones to miss an opportunity to see a glass half full, perhaps George Osborne’s Budget Statement on 25 November will deal the middlemen a fatal blow.
He announced that people will no longer be able to get cash compensation for minor whiplash claims. In the words of The Treasury statement, ‘To make it harder for people to claim compensation for exaggerated or fraudulent whiplash claims, the government is ending the right to cash compensation... This means that annual insurance costs for drivers could fall by between £40 to £50 a year.’
The Treasury said: ‘The Government is determined to crack down on the fraud and claims culture in motor insurance. Whiplash claims cost the country £2bn a year, an average of £90 per motor insurance policy (that figure comes from the Association of British Insurers), which is out of all proportion to any genuine injury suffered.’ However, claimants would still be entitled to claim for ‘special damages’, including treatment for any injury if required and any loss of earnings. It also plans to drive more claims through the small claims court by increasing the upper limit for these claims from £1,000 to £5,000.
The Government intends to consult on the details of how to remove the right to cash compensation early in 2016.
Whilst claimant personal injury lawyers will likely be hit hard by this change, if it kills off the MROs, and allows Medco to quietly pack its bags and go home, Mr Osborne will have the thanks of many an expert witness.