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Though After The-Event (ATE) insurance has changed very little as a core product over the past decade, the landscape has changed considerably.  This year, the long-awaited Civil Liabilities Act 2018 was passed from 31st May which saw significant reforms to the claims process for low value personal injury claims arising from a road traffic accident.

Implemented to combat the rising cost of whiplash claims, which according to the ABI amounted to £2 billion to the insurance industry each year, and adding £90 to the average motor insurance premium, the ‘Whiplash Reforms Programme’ (Reforms) introduced several changes to the claims process including:

  • An increase to the small claims track from £1,000 to £5,000.
  • Reduced compensation for the injury by setting a fixed amount payable for injuries lasting less than 2 years. As an illustration, a whiplash injury of around 6 months under the new Reforms would result in a compensation amount of circa £500, whereas previously the claimant would have likely received over £1,750 for pain, suffering and loss of amenity.
  • The implementation of an online claims portal to allow claimants to submit their own low value whiplash personal injury claim.

There’s no doubt the Reforms were much needed to address what has been termed a ‘whiplash epidemic’ in the UK, but the new measures have caused concerns around continuing access to justice for claimants and the ability of solicitors to recover costs from defendants.

The 64-page path to justice

In theory, the increase in the small claims track and introduction of the Official Injury Claim (OIC) portal makes it easier for motorists to pursue a claim for personal injury without needing legal representation and incurring additional legal costs.

Whilst the portal itself may be an easy-to use-tool, the guidance available to support claimants is not quite as straightforward.  At 64 pages and over 22,000 words, the lengthy guide is likely to prove confusing and frustrating for injured motorists leaving room for error and incorrect claims processes being followed.

We strongly believe claimants should be able to seek legal representation before lodging a personal injury claim and have access to protection against the risk of adverse costs and disbursements.

This is where ATE insurance is so valuable.  For a premium, payable on successful completion of the claim, claimants have the peace of mind that if they lose the case, they are protected against the adverse cost risks and disbursements incurred such as medical reports and court fees.

The proportionality conundrum

In the pre-Reforms personal injury landscape, the product worked well; whiplash claims typically had a higher value, exceeding the £1,000 threshold for fast-track cases and the solicitor was able recover costs from the other side.  On successful settlement of a claim, the claimant would have to pay any ATE Premium, and their solicitor’s success fees which were capped at 25%, from the compensation received.

However, the new fixed tariff sees awards ranging from £240 for a whiplash injury lasting up to 3 months, to £4,215 for injury lasting more than 18 and up to 24 months.  For these higher value claims, the claimant would be awarded a significant amount even after the deduction of their ATE premium and solicitor’s costs. However, claimants at the lower end of the tariff would see little value in pursuing their claim, with deductions disproportionate to the amount claimed.


It’s estimated that over 95% of injury claims will now fall within the small claims track, and whilst that number has increased significantly, the value of the ATE product has not followed suit.  Under the new tariff, ATE in its traditional guise is simply ‘not fit for purpose’ for small claims, and at a fixed premium, doesn’t represent good value for money for either the customer or the solicitor working on their behalf.

We’ve been working on our post-Reforms solution for some time to provide our customers with a high-quality product suitable for the post-Reforms world; working with our partners to develop a pricing structure that allows us to continue to support customers with first class legal support, at a price proportionate to the amount of their award.

In February, the Ministry of Justice finally announced the new tariff levels and within 3 months we had introduced a new tiered pricing structure designed to reflect greater proportionality in relation to compensation amounts.  Our premiums now reflect differing levels of indemnity between courts, offering greater value to motorists, regardless of the amount being claimed, and solicitors who can maintain their income stream from the recoverable costs from small claims.

Looking forward

More than 6 months on from the implementation of the Reforms, there are still many unknowns. Whilst 2 set of quarterly data have been published on the volume of claims started through the OIC portal since its introduction, we are yet to see the outcomes and use over an extended period, or the true impact of the legislation on the wider industry.  The early data however suggests that over 90% of claims registered through the portal had legal representation, which demonstrates that claimants still seek assistance from a legal professional when progressing a low value personal injury claim. We are confident therefore that our Motor ATE product is fit for purpose and offers continuity of support to our solicitor partners and their clients as well as true value when it’s needed.

If you require any further information on our Motor ATE product, please contact

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