The Profound Effects Of The Raised Small Claim Limit

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Government plans to increase the small claims limit from £1,000 to £5,000 will have significant repercussions for insurers, solicitors and most importantly, those injured in accidents explains Ocean Accident Claims.

Ocean Accident Claims

Small claims limit increase will make it less attractive for victims to seek compensation.

News that government proposals will have profound effect upon the claims process currently in place has been met with widespread criticism from Accident Claims Solicitors and the general public. The new move could see millions of Britons losing out in legal costs that would previously have been covered for them.

The new proposed legislation will effectively abolish the significance and use of the ‘No Win No Fee’ system that has served as the backbone for justice for many years. Many people who were injured in accidents that were not their fault could not and cannot afford the legal fees that taking legal action often incurs. The ‘No Win No Fee’ policy ensured that anyone, no matter their financial situation, could seek the justice that they deserve and are entitled to as their legal costs are covered.

Any Accident Claim Company offering the 'No win no fee claim ’ service will be affected significantly should the law change. It is suggested that should an individual have a potential claim, they should act quickly and contact Accident Claims Solicitors before these rulings potentially change.

According to Forbes Solicitors an incredible 95% of all personal injury cases in the UK incur between £1,000 and £5,000 in damages. Under the previous legislation and rulings, legal costs would have been recoverable. However, the legal costs are not recoverable in small claims cases. Increasing the upper limit of the small claims cases to £5,000 will mean that over 95% of Britons injured in an accident that was not their fault will be responsible for 100% of the legal fees.

This move by the government will most likely see a decrease in the amount of people who will seek compensation. Even those who have a watertight case may be reluctant to seek the compensation and justice that they deserve due to the legal costs that their actions may incur. These law changes may almost eradicate the number of Whiplash Compensation Claims that will be made should the law pass.

Sana Bibi wrote on Lexology, the web based law advice bureau, about the repercussions that these law changes will incur: “There is a very real risk that a vast majority of genuine claimants whose injuries may appear to be less than £5,000 will be deterred from bringing a claim when faced with the possibility of going to court unrepresented. Many will be undercompensated particularly those that settle their claims early for what they thought was minor injury but later turns out to be much more serious.”

In the opinion of many claims specialists the only party who will benefit from these proposals are the insurance companies. It remains to be seen whether these changes will encourage them to lower their premiums.

About the Company:
Ocean Accident Claims are a team of Accident Claims Solicitors specialising in helping those injured in accidents that were not their fault receive the compensation and justice that they deserve.

Sources: http://www.lexology.com/library/detail.aspx?g=dbaddf31-33ea-4b46-940a-a88d1fb5e358
http://www.forbessolicitors.co.uk/blog/foryou/2012/09/small-claims-and-unintended-consequences/

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