There was a time, now some time ago, where if a request was made of the Defendant’s insurers or their solicitors that an interim payment be made (namely a payment to be made at this stage of say a few thousand pounds to be taken into account on settlement of the claim) the Claimant had to show financial hardship.
The purpose of establishing financial hardship was to justify the interim payment. The Claimant had to establish a reason for the interim payment and justify that this should be made. This was patently unfair on the injured party. This is now no longer the case.
A Claimant therefore is entitled to an interim payment so long as the question of liability is no longer an issue and the Defendant therefore accepts that compensation will have to be paid at some point in the future.The question however, is the amount of an interim payment that is reasonable.
Clearly, if someone is in a wheelchair and requires large sums to pay for care, adaptations to their home, perhaps even the purchase of a new home, then interim payments might be numerous and can be substantial. Generally interim payments are of a relatively modest amount, sometimes in the region of no more than a few thousand pounds and other times in the region of £5,000 to £10,000. The Defendants will want to establish not only whether they are responsible for paying damages and that liability therefore has been accepted, either in full or in part, but also that an injury has occurred and that losses have arisen as a result.
There is invariably therefore a delay whilst the question of liability is assessed and in addition, whilst any evidence is obtained, GP notes, initial medical reports etc to establish the claim. Interim payments will be taken into account on final settlement.
Whilst it is perfectly possible to ask for more than one interim payment, from a Defendant’s perspective and unless such interim payments are justified such as the point that I raise above in relation to the Claimant who suffered devastating injuries and has been left in a wheelchair, a point will be reached where the Defendant’s insurers or solicitors will correctly say that rather than constantly making interim payments, the full value of the claim should be correctly assessed and the matter should proceed to settlement.
The Defendant’s insurers do of course not make interim payments out of the goodness of their own heart. They are required to do so and proceedings can be issued and an Order of the Court sought if the Defendants do not respond to a request for an interim payment that is reasonably put.
In addition the Defendant’s insurers avoid having to pay interest on amounts claimed which have then been discharged by way of an interim payment. If for example, where there is a claim for loss of earnings and interest is payable on this loss, if an interim payment then effectively discharges the claim for loss of earnings, interest is no longer due.Interim payments are not suitable in each and every case.
Every request should be dealt with on the same merits however I take the view generally, that if 'one does not ask, one does not get!' I say this without trying to sound in any way mercenary, but instead to illustrate what is in fact a true reflection of life.
Tristan Hallam is a partner in Personal Injury in the London office of Slater and Gordon Lawyers. If you or a member of your family has suffered an accident or injury call our expert personal injury solicitors on 0800 916 9046, fill in our short online claim form or email firstname.lastname@example.org and one of our specialist personal injury team will review your compensation claim for free.