Unamended ruling would have increased premium costs for customers, insurer says
Allianz Insurance has welcomed the Court of Appeal’s move to amend its previous decision about the pending 10% increase in general damages.
In its original ruling in the Simmons v Castle case, the court had decided that the 10% increase would apply to all claims settled after 1 April 2013.
After pressure from the Association of British Insurers (ABI), however, the court has amended its ruling, stating that the 10% increase will not apply in cases where the claimant has entered a conditional fee agreement before 1 April 2013.
In addition, the court said the 10% rise applying after 1 April 2013 woud be balanced by reductions in legal costs.
Allianz casualty and motor manager Sarah Mallaby (pictured) desscribed the amendment as “very good news for the general insurance industry”.
She said: “The original decision to apply a 10% uplift in damages to all claims settled after 1 April 2013, without reducing legal costs, would only have had negative implications for insurers, and ultimately would have resulted in increased premium costs for customers.”
Mallaby added: “We now need the Ministry of Justice to provide clarity around the new fixed fee arrangements for all claims with damages up to £25,000. This will ensure that the benefits envisaged by Jackson’s interlocking package of reforms are realised.”
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