What is a Compensation Protection Trust?
Compensation Protection Trusts are designed to ensure that any compensation awarded from a personal injury claim is not taken into account if you claim any means-tested benefits or need local authority support for residential care now or in the future.
What are the benefits for you?
If you claim any means tested benefits such as Universal Credit, Employment and Support Allowance, Tax Credit, Housing Benefit or Council Tax Benefit and go onto receive damages then your compensation may reduce or even stop your entitlement altogether.
By having a Compensation Protection Trust in place you should retain your benefits and your compensation. In your lifetime there’s a possibility you may need some level of care whether it be at home or in a nursing or care home.
By having a Compensation Protection Trust in place your funds are disregarded when being means-tested towards the cost of the care to be provided.
If the Compensation Protection Trust is required because the injured person is unable to look after the compensation themselves, or if they are too young and the Compensation Protection Trust fund needs protecting until they are 18, the compensation received is effectively put under the control of the persons nominated to be Trustees.
Who should be my Trustees?
Obviously your Trustees should be people that you trust and may include family, friends and or a solicitor or other professional. You decide who to appoint as your Trustees but they must be over 18. If you do choose to involve friends or family, it’s preferable to have at least two Trustees. Your
Trustees can look after any property or money in the Trust in the event that you cannot. Just remember being a Trustee can be quite demanding as it is a complex area with many rules and tax implications that need to be considered.
Banner Jones have an experienced Trust team who can help set up and manage these Trusts, allowing families to adjust to the injury without the burden of managing a Trust as well.
When do you need to set up the Trust?
The sooner the better, this will enable you to obtain maximum benefit from the trust. The Compensation Protection Trust must be set up within 12 months of you receiving your first payment under the claim for it to be effective in protecting your right to benefits. Our team are here to support you and can set a Trust up as part of the claim process.
If you do not have any immediate plans to spend the compensation which you are likely to receive, then we would recommend that you take steps to receive independent financial advice.
What can I claim for?
You will normally be entitled to claim for:
- Your pain and suffering
- Past and future loss of earnings
- Travelling and parking costs
- Medication and treatment costs
- Pension losses
- Care and services
- Legal and other fees involved in pursuing of your claim
How long will it take before I get compensated?
In most cases, the limiting factor is the length of time which has to pass before a final opinion can be obtained from a medical expert as to the extent to which an injured person has effected a recovery. In the simplest of cases a conclusion may be reached in around 6 months. However, where more severe injuries are sustained then it may take a number of years to get to a point where the medical eveidence is sufficiently clear to enable the case to be concluded.
In cases where liability is admitted but the case cannot be concluded quickly because of the nature of the injuries then it may be possible to obtain an interrim payment on account of the final award of compensation to be paid.
How much will I get?
The amount of compensation to be received is determined by an assessment of the extent to which you have been injured and have effected a recovery from those injuries. Each case is considered in the light of other cases which have been dealt with by the Courts so as to reach an appropriate level of award.
In addition to the award for the injuries sustained you can also claim for other financial loss such as lost earnings, travelling expenses and the cost of medication.Further and where appropriate a claim can be made for the value or cost of care required or the loss of benefits such as a pension.
What happens if I have Legal expenses Insurance?
If you have legal expenses insurance then we will contact your legal expenses insurers to seek authority to represent you under that policy.
Where we represent you under a policy of legal expenses insurance then in most cases from the date when cover is confirmed and up to the maximum cover provided by the policy your own and any of your opponents legal costs ordered to be paid by you will be met by your insurers.
What happens if I lose the case?
There are many different answers to this question which will depend on the exact terms of your retainer with your Solicitor. The answer below should only be taken as general guidance and you should ensure that your Solicitor makes the implications of losing the case clear to you given the manner in which you choose to fund your case.
If you lose the case then your liability for legal costs will depend on a number of factors and in particular the manner in which the claim is being funded at the point which the claim has reached.
In most cases where a claim is lost or discontinued prior to the issue of court proceddings then no costs will generally be recovered by the successful opponent from you.
Where a case is unsuccessful after court proceedings are issued then it is likely that you would be held responsible for your opponents costs . Where you have the benefit of a policy of legal expenses insurance then it is likely that your opponents costs will be covered by that policy. Where no such policy is in place then it is likely that you will be responsible personally for those costs.
Where a case is unsuccessful after court proceedings are issued then you will generally also be responsible for your own legal costs. Where the claim is being pursued on a conditional fee agreement then no charge will be made by the your Solicitor. However, in all other casesyou will be reponsible for your own costs save where a policy of legal expenses insurance is in place which covers those costs.
Will I have to go to court?
It is rare that a claim will proceed to a final hearing before the Court which you would have to attend.
Will I have to visit a Doctor as part of the case?
In all cases where a claim for personal injuries is made , that claim needs to be supported with medical evidence in the form of a medical report. This report is prepared following a medical examination with a nominated medical expert which will be arranged by your Solicitor.