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Will my State benefits be deducted from any compensation that I recover from my claim for personal injury?

Published on 20 April 2021 | Modified on 14 December 2022

Written by Stacey Bennett

All personal injury claims are registered with the Compensation Recovery Unit (CRU) at the outset; usually by the defendant’s insurers.

The Compensation Recovery Unit will usually issue directly to you or your legal representatives a statement detailing any State benefits that may have been paid since the date the claim arose and as a result of the injuries.  The certificates will be sent out periodically until the claim concludes.

It is the responsibility of the insurers of the other side to refund to the Department for Work and Pensions, at such time as any compensation is paid, any recoverable benefits.

If the certificate indicates that no recoverable benefits have been paid as a result of the injuries then it is unlikely to have any impact on your claim.

The repayment of recoverable benefits is made by the other side in addition to any compensation paid. However, the other side may be entitled to reduce any compensation which is ultimately paid insofar as corresponding benefits have been paid. This is because the objective, in providing compensation, is to put the injured person in the financial position that he or she would have been in had the injuries never occurred (and, of course, had the injuries not occurred, State benefits, received as a result of those injuries, would not have been paid).

The other side is only liable to repay benefits, and to use any benefits paid to reduce the compensation payable, up to the time compensation is paid or for 5 years after the injuries were suffered, whichever is the soonest.

Which benefits are affected?

Compensation for lost earnings can be reduced by any of the following benefits paid as a result of the injuries:

(a)        Disablement Pension payable under Section 103 of the 1992 Act (also known as IIDB);

(b)        Employment and Support Allowance;

(c)        Incapacity benefit;

(d)       Income support;

(e)        Invalidity pension;

(f)        Invalidity allowance;

(g)        Jobseeker’s allowance;

(h)        Reduced earnings allowance;

(i)         Severe disablement allowance;

(j)         Sickness benefit;

(k)        Unemployability supplement;

(l)         Statutory Sick Pay paid before 6th April 1994

(m)       Unemployment benefit;

(n)        Universal Credit.

Compensation for care and attendance can be reduced by any of the following benefits paid as a result of the injuries:

(a)        Attendance allowance;

(b)        Care component of disability living allowance;

(c)        Disablement Pension increase for Constant Attendance Allowance Living component of Personal Independence Payment (PIPL);

(d)       Exceptionally severe disablement allowance.

Compensation for loss of mobility can be reduced by any of the following benefits paid as a result of the injuries:

(a)        Mobility allowance;

(b)        Mobility component of disability living allowance.

(c)        Mobility component Personal Independence Payment (PIPM)

If you would like any more information on how your benefits may be impacted by a claim for compensation, please feel free to contact our Personal Injury team on 01270 613939 or contact us here and we will get back to you.


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