Interim payments in personal injury and medical negligence claims: What are they and when can you get one?

One of the hardest things about a serious injury claim is that life does not wait for the legal process. Earnings may have stopped. Specialist equipment may be needed. Therapy that could make a real difference is available now but has to be paid for. The family home may suddenly be unsuitable. Meanwhile, the compensation claim itself may still be some distance from settlement.

I have seen how frustrating this can be. On paper, someone may have a substantial claim, but that does not pay this month’s mortgage, fund rehabilitation or put the right care in place. In a serious injury or medical negligence claim, it’s often unrealistic to expect an injured person and their family to wait until final settlement before receiving compensation.

That is why interim payments can be so important in serious injury and medical negligence claims. They allow part of the likely compensation to be paid early, helping to meet immediate needs whilst the legal and medical picture continues to develop.

An interim payment is part of your compensation paid before the claim has finally settled. It’s an advance on the eventual award, rather than additional compensation.

If someone receives £100,000 in interim payments and their claim later settles for £1 million, the £100,000 will normally be treated as money already received, leaving a balancing payment of £900,000. Its value lies not in increasing the compensation, but in making some of it available much earlier.

Serious injury claims can take time to resolve for good reasons. Doctors need to see how your injury develops before giving a reliable prognosis. Rehabilitation, care and employment needs may change, and substantial future losses often take time to assess properly. Settling too early can leave an injured person undercompensated, with a serious risk that the money will eventually run out and no longer be enough to meet the care, support and other needs it was intended to provide for.

An interim payment can help bridge that gap.

No. Not all early financial help during a claim takes the form of an interim payment.

In many serious injury claims, the defendant or their insurer may agree to fund rehabilitation under the Rehabilitation Code. This voluntary framework encourages rehabilitation needs to be identified and addressed early, rather than waiting for the compensation claim to conclude.

Funding might cover an immediate needs assessment, case management, physiotherapy, psychological treatment or other rehabilitation, usually with payment made directly to the provider.

This is different from an interim payment. Rehabilitation Code funding is ordinarily provided separately for agreed rehabilitation needs, whilst an interim payment forms part of the compensation and is ultimately brought into account when the claim concludes.

The two can work alongside each other.

A court application is not always necessary. Sometimes, the defendant or their insurer will agree to make an interim payment voluntarily, sometimes before court proceedings have even begun.

The Pre-Action Protocol for Personal Injury Claims encourages the parties to consider rehabilitation needs at an early stage. It also recognises that early notification of a claim can be useful where substantial expenditure is already being incurred and a contribution from the defendant is being sought.

The Pre-Action Protocol for the Resolution of Clinical Disputes takes a similar approach in medical negligence claims, encouraging the parties to consider rehabilitation needs as early as possible.

If an appropriate interim payment cannot be agreed, it may be possible to ask the court to order one. The relevant rules are contained in Part 25 of the Civil Procedure Rules.

Not necessarily.

An admission of liability will usually make an interim payment easier to obtain, but it’s not essential.

The court can order an interim payment where liability has been admitted, where the claimant has already obtained judgment but damages remain to be assessed, or where it’s satisfied that, if the claim went to trial, the claimant would obtain judgment for a substantial amount. Separate provisions apply where there is more than one defendant.

This can be particularly important where there is still an argument about whether the injured person was partly responsible for an accident, but no realistic prospect that the claim will fail altogether.

Where contributory negligence is in issue, however, it must be taken into account when deciding how much can safely be paid on an interim basis.

There is no fixed timescale.

A voluntary payment can sometimes be agreed relatively early once there is sufficient evidence about liability, the injured person’s needs and the likely value of the claim. If a court application is necessary, the process will take longer and will need to be supported by evidence.

In a serious injury claim, the aim is usually to secure appropriate funding as soon as the evidence allows, rather than waiting for final settlement.

There is no standard percentage or fixed maximum.

The court cannot order more than a reasonable proportion of the likely final judgment. In deciding what that means, it must take account of matters including contributory negligence and any relevant set-off or counterclaim.

An application therefore needs evidence. The court will need to understand how much is being requested, why it’s needed and the likely overall value of the claim. In a personal injury case, that will usually involve medical evidence together with details of past and future financial losses.

The objective is not simply to obtain as much money as possible, as early as possible. It’s to secure an appropriate part of the likely compensation without getting ahead of what the evidence can safely support.

Our guide to how future financial losses are calculated in a personal injury claim explains why assessing the eventual value of a serious injury claim can itself be a substantial exercise.

This is where interim payments can make a very real difference.

A main earner may suddenly have little or no income. Someone may be ready to leave hospital but unable to return to an inaccessible home. A specialist wheelchair, prosthesis or adapted vehicle may be needed, or therapy that could help now rather than months or years later.

Depending on the circumstances and what is already being funded in other ways, interim payments can be used towards lost earnings, rehabilitation and treatment, care and case management, specialist equipment, adapted vehicles and accommodation needs. Our guide to spinal cord injury claims explains how interim payments can help fund rehabilitation, mobility equipment and work to make a home more accessible.

It’s important not to lose sight of what this means in practice. Funding physiotherapy six months earlier, putting a case manager in place or making it possible for someone to return to a suitable home can matter far more to an injured person and their family than the fact that the payment happens to be labelled “interim”.

The purpose is not simply to release money early. It’s to help meet real needs and allow the injured person to move forward whilst the claim continues.

Yes, and many people do.

Serious injury claims can last several years, and a person’s needs may change considerably during that time. The Civil Procedure Rules expressly allow more than one application for an interim payment.

An early payment might help replace lost income or meet immediate needs after discharge from hospital. A later payment might contribute towards an adapted property, specialist equipment or a developing care package.

Receiving one interim payment does not therefore prevent another from being made later, provided it remains appropriate in light of the likely total compensation award.

In these cases, additional safeguards apply.

A child must have a litigation friend conducting the claim on their behalf unless, exceptionally, the court permits them to conduct the proceedings themselves. A protected party – broadly, someone who lacks capacity to conduct the proceedings – must always have a litigation friend.

A settlement, compromise or payment relating to a claim by a child or protected party, including a voluntary interim payment, is not valid without the court’s approval. The court also controls how money recovered for them is dealt with. The detailed provisions are contained in Part 21 of the Civil Procedure Rules.

This does not prevent interim payments being used to meet genuine and sometimes urgent needs. It simply adds protection around the injured person and their compensation.

Potentially, yes. This is something that should be considered before the funds arrive, rather than afterwards.

For Universal Credit, current Government guidance says that personal injury and illness compensation is disregarded for the first 12 months after receipt. After that period, compensation placed in a trust or used to purchase an annuity can continue to be disregarded. The Government’s Universal Credit guidance explains the position in more detail.

Other means-tested benefits and individual circumstances can raise different issues, particularly where several compensation payments are received. It’s therefore important not simply to assume that receiving an interim payment will have no effect.

Where appropriate, planning may include setting up a personal injury trust or considering other arrangements for protecting and managing the compensation.

Yes, because an interim payment forms part of the compensation rather than being additional to it.

When the claim concludes, interim payments already received are brought into account. The court can also adjust an interim payment in appropriate circumstances, including ordering repayment of all or part of it. This is another reason why the amount sought needs to be considered carefully against the likely eventual settlement figure.

But that point should not obscure why interim payments matter. In a serious injury claim, final settlement may still be years away. Rehabilitation cannot necessarily wait that long. Neither can mortgage payments, care needs, housing decisions or the day-to-day realities of family life.

A well-timed interim payment can allow the legal claim to move at the pace the evidence requires without forcing the injured person’s life to move at the same pace.