You are here

Insurance market will 'respond positively' to Jackson reforms, Lord Wallace says

31 January 2012

Government minister Lord Wallace has told peers that the government expects the insurance market to “respond positively” to the Jackson reforms.

Lord Wallace announced earlier that implementation of the reforms would be postponed until April 2013 to coincide with the legal aid cuts, in the latest committee stage debate in the House of Lords on the legal aid bill.

“It is easy to say ahead of an event that all sorts of appalling things will happen, but after 1999 the market certainly adjusted to the opportunities with ATE premiums, and it is not surprising that those who wish to maintain the status quo are making substantial representations to that effect.

“Ministry of Justice ministers and officials have met a substantial number of different insurers as the proposals have been developed since Lord Justice Jackson’s recommendations were published,” Lord Wallace said.

“Although some providers have said publicly that they will pull out of the ATE market if the changes go ahead, others have indicated that they will look positively at developing products which meet market needs as the details of the proposals are finalised.”

Lord Wallace rejected amendments that would have inserted clauses on the ten per cent increase in general damages and the introduction of QOCS (qualified one-way costs shifting) into the bill.

In answer to an oral question from Conservative peer Lord Faulks, Lord Wallace said that bereavement damages would be increased by ten per cent, in line with the increase in general damages.

A spokesman for APIL welcomed the increase in bereavement damages, which were “known to be too low and need to be increased”.

Don Clarke, president of FOIL, said: “It is disappointing that it looks as though the implementation of the reforms will now be delayed until April 2013.

“However, a six-month delay is preferable to a piecemeal implementation that fails to deliver the key elements of Jackson as an interlocking package.”

Categorised in: