The Compensation Recovery Unit (CRU) recovers certain state benefits and NHS costs after an injury claim.
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What is the Compensation Recovery Unit?
The Compensation Recovery Unit (CRU) is a government body within the Department for Work and Pensions (DWP) that plays an important role in personal injury claims.
Its main purpose is to ensure that if you receive compensation for an injury, any state benefits and certain NHS treatment costs already paid by the government are recovered from the party at fault.
This ensures that the cost of those benefits and NHS treatment is passed from the taxpayer to the person or organisation responsible for your injury. The CRU also holds the responsible party liable for the costs paid because of their negligence.
Understanding how the CRU works can help you know what to expect when receiving compensation.
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Why does the CRU exist?
Suffering an injury or illness because of someone else’s negligence can affect your ability to work and carry out daily activities. In such cases, you may receive state benefits during your recovery, such as Employment and Support Allowance (ESA), Industrial Injuries Disablement Benefit (IIDB), or Universal Credit.
You may also need care and treatment, such as an ambulance, hospital stay, and medication, which the NHS provides at no cost to you.
However, if you later decide to make a personal injury claim for pain, suffering, or financial losses, the government has the right to recover any state benefits and certain NHS costs already paid as a result of the injury.
The Compensation Recovery Unit exists to manage this process and ensure that:
- You are not paid the same type of financial support twice for the same injury.
- Taxpayer money is used responsibly.
- The government recovers the costs incurred due to someone else’s negligence.
- The liable party is held responsible for the losses they caused.
- Your final compensation payment accurately reflects your losses.
How does the Compensation Recovery Unit work?
The CRU works on behalf of the Department for Work and Pensions (DWP) to recover state benefits and certain NHS treatment costs paid to someone who has suffered an injury or disease because of negligence. The process works like this:
- When you make a personal injury compensation claim, your solicitor notifies the CRU about your case.
- The CRU tracks and calculates the total amount of state benefits and any recoverable NHS treatment costs paid as a result of your injury.
- The Compensation Recovery Unit then issues a CRU certificate, which confirms how much must be repaid in benefits and NHS charges.
- Once your claim is settled, the defendant’s insurer deducts the amount of recoverable benefits from the relevant parts of your compensation award and pays the NHS charges separately.
- The insurer pays the benefit amount to the DWP and the NHS charges to the NHS, and you receive the remaining compensation you are entitled to.
What types of benefits can be recovered by the CRU?
Under the Social Security (Recovery of Benefits) Act 1997, the CRU can recover certain state benefits paid as a result of an injury or illness caused by negligence. These benefits are recovered from the defendant or their insurer, and include:
Benefits related to loss of earnings
These benefits replace income where an injury has affected your ability to work:
- Employment and Support Allowance.
- Universal Credit.
Benefits related to care and disability needs
These are paid to help with daily living assistance and care needs arising from an injury:
- Industrial Injuries Disablement Benefit.
- Attendance Allowance.
- Disability Living Allowance (the care component).
- Personal Independence Payment (the daily living part).
Benefits related to mobility and independence
If an injury affects your ability to move or travel independently, the CRU may recover:
- Disability Living Allowance (mobility component).
- Personal Independence Payment (the mobility part).
You do not repay these benefits yourself. Any recoverable benefit amounts are deducted from the relevant parts of your compensation, such as loss of earnings or care costs, and are paid directly by the defendant’s insurer.
What compensation is not affected by the CRU?
The Compensation Recovery Unit does not deduct money from every part of a compensation award. Certain types of compensation are generally paid to you in full, regardless of any benefits you have received, including:
- The compensation for pain, suffering, and loss of amenity, also known as general damages. This covers your physical pain, emotional distress, loss of enjoyment of life, and permanent disability.
- Compensation for future losses and expenses, such as future loss of earning capacity, future care and support, mobility aids, or rehabilitation.
- Damages unrelated to the benefits you received, such as private medical treatment, certain travel costs, or medical equipment paid for personally.
NHS treatment costs recovered by the CRU do not reduce your compensation. These are paid separately by the defendant’s insurer to the NHS.
How CRU deductions work in personal injury claims
For example, you win an injury claim following a road traffic accident and receive a total compensation of £50,000:
- £30,000 for lost earnings and other financial losses (special damages)
- £20,000 for pain, suffering, and loss of amenity (general damages)
Suppose the recoverable benefits in your case amount to £5,000. The defendant’s insurer will deduct the £5,000 from the relevant part of your £30,000 special damages. You would then receive the remaining £45,000 (minus any legal costs). Any NHS treatment costs are paid separately by the insurer and do not reduce your award.
Key takeaways about the Compensation Recovery Unit
- The CRU is a part of the Department for Work and Pensions that helps recover certain state benefits and NHS treatment costs paid as a result of an injury.
- It ensures that the cost of state support and NHS treatment is passed to the party responsible for the injury, rather than the taxpayer.
- The CRU can recover benefits related to loss of earnings, mobility, and care needs. These are not deducted from your general damages or future losses.
- Once a claim is made, the CRU will issue a certificate listing the recoverable benefits and NHS charges. The defendant’s insurer will pay these directly to the DWP and the NHS.
To understand how CRU deductions may affect your claim, do not hesitate to call 0800 470 0472 today for a free consultation with a legal adviser. You can also use our contact form to request a call back.
