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Small Claims Limit Increase Delayed for at Least Another Year

The Government Response to the Justice Committee’s Seventh Report of Session 2017-2019: Small Claims Limit for Personal Injury has now been released.

The Government has agreed to delay the roll out of changes to the Small Claims limit until April 2020, ensuring that “the reforms and implementation is done right rather than quickly”. The Government have proposed that the new platform from which Small Claims RTA cases will run will be ready for large scale testing by October 2019.

The Committee recommended that the lowest Small Claims threshold for non RTA claims should be set at around £1500, but the Government have stood by their intention to raise the limit to £2000. Both the Committee and Government recommend these increases on the basis of inflation and the difference in figures is due to different methods used to calculate it.

The Government rejected the Committee’s recommendation not to increase the RTA personal injury Small Claims limit to £5000 and highlighted various arguments in favour of the increase.

The delay will not be welcomed by the insurance industry who will benefit from the impact of the reforms which are expected to reduce the number of fraudulent claims and facilitate earlier settlements. Consumers should also benefit from the reforms, with motor insurance providers which cover 84% of the UK market, having already written to the Lord Chancellor with their commitment to passing on any savings.